BTCUSD Technical Analysis | Forexlive
On the daily chart below for BTCUSD,
we can see that the price recently broke above a key resistance level that was set in June 2021.
Like gold, bitcoin has been on an incredible rally since the collapse of the
Silicon Valley Bank. Maybe that’s why Bitcoin is called “the digital gold”.
In fact, Bitcoin started to
correlate with traditional assets since the covid pandemic because of wider
adoption by retail and institutional traders. We can see it selling off in
times of risk-off sentiment like other risk assets and rallying when there’s a
positive sentiment in the market.
The moving
averages are still crossed to the upside, so the bullish trend remains intact
for now, but the big divergence with the MACD is a bad omen for the buyers if
a negative catalyst triggers a selloff.
On the 4 hour chart below, we can
see that the price broke out of the recent range formed right at the key
resistance level at 28911. Recent US economic data has been missing
expectations prompting the market to expect the Fed to end its tightening cycle
at the May meeting.
What may bring bitcoin down is a
recession as the risk sentiment would turn negative and the cryptocurrency
would be sold off. Today we have the US Retail Sales report and if the data misses
expectations, it’s likely that we will see more downside for bitcoin.
On the 1 hour chart below, we can
see that there’s another divergence here. The level to watch is the trendline and the moving averages. If the
price breaks below the trendline, we will likely see a pullback to the swing support at 29685.
And if that level breaks as well,
then the sellers will extend the bearish move to the previous key resistance
that now may turn support. The buyers are likely to lean on the trendline as
they will have a defined risk and can fold fast if the price breaks below the
trendline. The next support for them will be the 29685 level.