It is very difficult to do a technical chart analysis when volatility spikes and market participants are just trading to stay liquid and trying to shore up their cash reserves. We have also seen BTC$ tracking very closely to equities, with yesterday being the first exception. BTC$ has tended to follow gold.
At our trading desk, we have mentioned it a few times: we believe that all of the measures taken by the central banks will lead to inflation, or, at least, an anticipation of inflation. It is for this reason that we are also tracking long-end treasuries or TIPS (Treasury Inflation Protected Securities). Especially the TIPS can provide a clear picture of how much inflation the market is pricing.
Therefore, we will stick to charting BTC$ (from a high timeframe through to much shorter ones).
“We are hanging in there” is probably the correct expression to describe the current state of the price of bitcoin.
The large symmetrical triangle, which I see as a long consolidation of three years, is still holding its ground.
The first warning sign for my bullish case would be if we trade below 5.9k. The last resort will be the lower leg of the triangle, which comes in at around 5k. Please do not take these levels as intra-week or even intra-day guidance. I am speaking solely with respect to the weekly closing levels.
The topside levels to watch are 8k, 10.5k, and 11.5k.
There is really not much to see on the daily chart. Maybe there is a relatively large liquidity pool at around 7k, which has worked like a magnet over the past two spikes higher. But, currently, I am not convinced that we will be able to stay up there.
We have been fighting around the upper end of the Ichimoku cloud for quite some time now. On a 4h closing basis it still holds as a tough resistance.
If we manage to close above it, and see the next 4h bar above the 6.6k level as well, I will need to revise my bearish view and turn more neutral.
If we are not able to break through the 6.6k level I mentioned on the 4h chart, we will go back down towards the 6.2k level, where much of the trading has happened over the course of the past week.
If the pressure to the downside starts to mount, and 5.7k gives way, I see a good chance of a quick dip down to 5.2k, and maybe even to lows around 4.9k.Read more