Bitcoin (BTC/XBT) Daily Technical Analysis 2021/05/21
Bitcoin is at a critical price zone of ~$40K, which way price breaks will likely determine if we can continue the bull run or if we will start a prolonged bear market.
Taking a look at the charts, we see that after price broke down from the $42K level of support, price rapidly collapsed down to $30K. Price then rapidly recovered in a V-shaped recovered back up to the $42K point of breakdown. On the first attempt to break above $42K, price reached a high of $42.5K but got rejected and formed a higher low @ $38K. Price then attempted to break $42K a second time, but again failed to do so, and actually wasnt able to get as high as the 1st attempt, thus forming a lower high @ $42.2K. Thus we have a higher low and a lower high, indicating market indecision and consolidation, somewhat forming a triangle pattern.
The critical levels to watch are $42-42.5K on the upside and $38-39.5K on the downside. A break and close above $42-42.5K will likely mean that the bottom has been put in, while a break and close below the 38-39.5 zone will likely bring about further price collapse. Right now, as Im typing this, price is testing the 38-39.5 zone. It is critical for the bulls to bounce here and form a third higher low and then retest the resistance zone of $42-42.5K, otherwise there might be more pain coming.
Of course, in trading and investing nothing is guaranteed and technical analysis is only probabilities, never a guarantee of what will happen. As I said in my posts in recent days, markets are being manipulated right now on the derivatives markets. These moves are due to liquidations and not organic spot buying and selling. Id recommend against taking on leveraged positions, either long or short, at this point in time until markets start to calm down and form some structure.
Everything Im sharing is just personal opinion and not financial advice. As always, stay safe.
Taking a look at the charts, we see that after price broke down from the $42K level of support, price rapidly collapsed down to $30K. Price then rapidly recovered in a V-shaped recovered back up to the $42K point of breakdown. On the first attempt to break above $42K, price reached a high of $42.5K but got rejected and formed a higher low @ $38K. Price then attempted to break $42K a second time, but again failed to do so, and actually wasnt able to get as high as the 1st attempt, thus forming a lower high @ $42.2K. Thus we have a higher low and a lower high, indicating market indecision and consolidation, somewhat forming a triangle pattern.
The critical levels to watch are $42-42.5K on the upside and $38-39.5K on the downside. A break and close above $42-42.5K will likely mean that the bottom has been put in, while a break and close below the 38-39.5 zone will likely bring about further price collapse. Right now, as Im typing this, price is testing the 38-39.5 zone. It is critical for the bulls to bounce here and form a third higher low and then retest the resistance zone of $42-42.5K, otherwise there might be more pain coming.
Of course, in trading and investing nothing is guaranteed and technical analysis is only probabilities, never a guarantee of what will happen. As I said in my posts in recent days, markets are being manipulated right now on the derivatives markets. These moves are due to liquidations and not organic spot buying and selling. Id recommend against taking on leveraged positions, either long or short, at this point in time until markets start to calm down and form some structure.
Everything Im sharing is just personal opinion and not financial advice. As always, stay safe.
