Will Bitcoin be able to maintain bullish posture in the face of low volume? Covered: The Struggle Is Real We May Be Back Above Support, But… Bitcoin: The Struggle Is Real After yesterday’s massive sell-off and big red candle, Bitcoin has somehow managed to defy gravity and fight its way back above the lower support […] The post Bitcoin Bullish Again, But Watch For This Key Pattern appeared first on CryptosRus.

Bitcoin Bullish Again, But Watch For This Key Pattern

Will Bitcoin be able to maintain bullish posture in the face of low volume?

Covered:

  • The Struggle Is Real
  • We May Be Back Above Support, But…

Bitcoin: The Struggle Is Real

After yesterday’s massive sell-off and big red candle, Bitcoin has somehow managed to defy gravity and fight its way back above the lower support line of the bullish Falling Wedge pattern we’ve been tracking in the previous Bitcoin analysis.

 

One thing I find very interesting is when current price action perfectly interacts with lines that were previously drawn on the chart.

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In this case, we can see how these four-hour candles were perfectly respecting the lower trendline of our falling wedge, before finally breaking above it.  I now have further confidence in the importance of this line and feel less speculative about the Falling Wedge pattern as a whole.

 

Bitcoin: We May Be Back Above Support, But…

While we are currently back above our support line, there are several factors that give me cause for concern.

Number one on that list is the very low volume.  This is something that has continued to plague the Bitcoin price over the past several weeks.  Every time it starts to reach higher prices, there has been a drop off in buying pressure.  When volume does come in, it seems to be in the form of increased selling, causing rapid drops in price.

The lack of buying pressure can currently be seen as the double bearish wicks to the upside trying to print on the four-hour chart.  This suggests that buying is already dropping off, while selling is increasing.  If things continue to play out in this manner, we might find the Bitcoin price back below our support line before too long.

 

Also of note, is the bearish cross currently trying to take place between the 20 Day Simple Moving Average (image below, yellow line), and the 50 Day Simple Moving Average (image below, green line).

 

What this potential cross is showing us is the loss of momentum to the upside.  The prolonged sideways and downward motion has caused the faster moving 20 to dip down and meet the slower moving 50.

However, this cross is not necessarily indicative that lower prices are incoming.  A similar cross was seen recently between September 22, and October 11, 2021, which turned out to be short-lived when the Bitcoin price shot up from about $40,000 – $69,000 USD.

However, this is not something that happens in a strong uptrend, so we should at least be aware of it as a potential warning sign.

 

Find yesterday’s Bitcoin analysis here.

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The post Bitcoin Bullish Again, But Watch For This Key Pattern appeared first on CryptosRus.