After impressive growth since mid-February, when Bitcoin (BTC) traded 177% above its annual minimum in December 2018, the main cryptocurrency for market capitalization seems to be draining its growth momentum. At the same time, there is less confidence in the possibility of exceeding the BTC barrier of $ 9,000 without first creating a local minimum in areas with greater liquidity for purchases, such as the range between $ 6,600 and $ 7,000.
BTC spot prices have defied gravity since April, when the cryptocurrency rose, which led to an increase in prices from $ 5,000 to $ 9,000. Institutional demand, the trade war between the United States and China, and the potential flight of Chinese capital, may be the main drivers of pressure to buy which brought the price to such extremes.
However, as the cryptocurrency continued to grow, the need for regression became apparent. Reductions in movements, or, rather, corrections, allow oxygenation of prices, looking for pivot points in historical pillarsand accumulate enough power for the next impulse.
In the following graph, we see how the price reduced its buyer's momentum. When the price of his career rose to $ 9,000, green candles began to decrease and become more indecisive. A break in a parabola, followed by a red candle with a volume, as shown in the graph, operators seek to determine end of expansion and start of reduction.
Similarly, the Ichimoku Cloud can be interpreted with duplicate configurations for more accurate signals. As for the weekly seasonality, Bitcoin continues to show a bearish forecast, but with a high probability it targets $ 10,000. However, trends of this type are characterized by the fact that Kijun (red line) and Tenkan (blue line) are close to price movement. With such a distance, the probability of overbought and return to its midpoint (Kijun) increases significantly. In a period of strong growth, Kijun will serve as a base for determining potential regression points.
Currently, the Kijun is close to $ 6,600, which should serve as a magnet for the price in case of failure. In this sense, the historical volume (horizontal columns) indicates that any deviation from the price will acquire liquidity and should not exceed the range of $ 6,300 to $ 6,500.
On the daily chart, the metric with the Ishimoku cloud is still 100% bullish: the price is higher than the cloud, the bullish cloud, the Kijun and the Tenkan cross are bullish, and the delay interval is higher than the price and clouds.
Breakthrough of the relative strength index (RSI) trend line (in the graph below) marks the end of the bull movementAs indicated on the graph, the RSI has shown higher lows since December 2018, however On May 31, the trend line was broken, giving way to a correction in the indicatorAlthough it fell to its lowest level in a few weeks, it is still in a bullish area (above point 50), so the dynamics remain optimistic.
And finally, in the 4th season, the price movement strongly marked the levels of support and resistance. After the expiration date of CME futures on May 31, the market seems to have entered a bearish volatility boom that leads to bitcoin with a little lateralization from 7,500 to 8,250 US dollars,
In previous cases, the gap of $ 8,250 brought unit volumes to move prices higher or lower, so one should expect that the gap in the area should be accompanied by the same load of purchases (which is current) to witness an organic increase in the asset.
Although this trend is bullish, technical analysis for longer periods of time shows signs of overbought conditions and a downward impulse. In a lower time frame, price sets a bearish continuation pattern, suggesting an increasingly likely failure.
If we add a decline in the Long vs. Shift index to Bitfinex to 1.0 (with its maximum of 1.55) and a decrease in the rate of Bitmex financing over the past two weeks, the mood about the sale may continue. $ 6,600 and $ 7,000. As long as the resistance at 8000 – 8 250 US dollars is not broken, the correction will be most likely.
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