Bitcoin USD chart analysis – calendar week 17/22

Daily Bitcoin USD


Bitcoin USD Weekly Review: Market Dominated by Selloffs Again

The reporting week started again with an eventful Monday. The initial selling took the price down to $38,201 at the day’s low before buying in the second half of the day took the price down to $40,438 at the close. The 40,000 area had often acted as a support zone over the previous 14 days. The next trading day, however, was followed by the unequivocal acknowledgment that the market has always been characterized by lower daily highs since breaking through the 45,000 resistance. The day’s gains were more than eliminated with a daily close of 38,148 on Tuesday. The biggest daily loss of the week, marked by a minus of 5.75%, was followed by a slight recovery to USD 39,285 on Wednesday, which was able to hold at USD 39,766 on Thursday. Once again a daily high lower than the previous day was reached and the market continued in the direction it had been heading for 26 days. On Friday and the weekend, there were further course corrections, which eventually brought Bitcoin into the territory below USD 38,000 by the end of the week.

The first signs of a trend reversal are becoming more and more diluted


Review Daily Interval

After the fall in prices in mid-March 2020, a real counter-movement took place. This led to resistance areas above $10,000. After an initial rejection and a nearly two-month consolidation phase, a breakout through the fundamental resistance zone followed on July 27, 2020, which has persisted since August 2019 and has repeatedly caused Bitcoin to fail.

The resistance zone around USD 10,000 was interesting in several respects. On the one hand, the Fibonacci point at 0.618 of the whole bearish movement, announced at the end of June 2019 just below USD 14,000, was in this price range. On the other hand, the area around USD 10,000 also served as a testament to the still bearish trend from the lower highs since December 2017 (see the macro view on a weekly basis). Bitcoin has been able to establish itself above the newly created support in the $10,000 area since late July 2020 and, with the breakout of the resistance zone around $12,200 near the end of October 2020, provided the first confirmation of a trend reversal in the bear market that has been going on since 2018. Over the following weeks, the positive trend deepened and drove Bitcoin through the 14,000 resistance in early November 2020 and early December for the first time near all-time highs of $20,000, which have remained untouched for 158 weeks since the 2017 bull market.

With the breakthrough of the former all-time high at USD 20,000, the trend reversal was definitely announced. As a result, there was a strong accentuation in the uptrend, which took the price of Bitcoin to its new all-time high of just under $65,000 in just over 4 months. However, the rapid upward movement was abruptly halted in mid-May 2020 and brought Bitcoin back to the $30,000 zone. After a three-month consolidation phase, the bullish movement continued no less spectacularly after a “rounding down” in the 0.61 Fibonacci zone, which finally ended in a new all-time high of 69 000 USD in October 2020 after a “retest” of the 40,000 area. Since then, a strong corrective phase has dominated again, which has brought the Bitcoin price back into the 34,000 USD area and thus into price territories determinants for the trend. A 70-day bottom formation marked by higher lows eventually took Bitcoin above the stubborn resistance at 45,000.

Outlook Daily Interval

Just 73 days from the all-time high of $69,000, the subsequent breakout of the 40,000 support zone suggested a change of course. The 401-day bull run appears to be running out of steam. The additional direction of movement could therefore turn out to be longer sideways movements and the formation of the bottom in the 34,000 range has yet to be proven.

Since the bottom of the recent correction was reached, a bottom formation has been recorded, which has manifested in a series of daily higher lows. The first subsequent and sometimes violent counter-moves ended in the $45,000 area, a dominant resistance area, whose price area has often given new direction since January 2021.

After the recent breakthrough through the important resistance of 45,000, a consolidation started, which in the meantime took the price of Bitcoin back below the 40,000 area. The newly created price structure, which recently indicated a return of the bullish momentum, is now threatened by the latest price movements. The structure of the higher lows formed over three months has been broken. A sustained break of the $38,000 area will negate the recently built bullish momentum and make a re-visit of the lows more likely.

New pricing phase shows weakness


Examine the interval of a week

In 2020, Bitcoin was able to set a high above USD 10,000 for the first time in a weekly interval, which broke the dominant downtrend since December 2017. This interrupted the series of lower highs that lasted 135 weeks (1).

Since that first break in the downtrend, the signs of a valid trend reversal have intensified. With the breakout through major resistance areas and continued development above the 21-week (2) average, the likelihood of hitting the all-time high created in 2017/18 has once again increased noticeably. This scenario was implemented in mid-December 2020. This was followed by a sharply accentuated price finding above this historic zone, which produced a new all-time high of $65,000 in mid-April. A consolidation that began since then resulted in a real price crash that took Bitcoin below USD 30,000 in just two weeks and even pushed it back below the 21-week average (2) that defined phases bullish or bearish market in the past.

However, a subsequent breakout of the $30,000-40,000 10-week consolidation zone and a subsequent successful “retest” of the upper range of this channel recently brought Bitcoin into an impressive counter move above the top. history created in April. After the creation of the new all-time high in the USD 69,000 area in November 2021, a vehement phase of correction began again, analogous to the pattern seen in May. This first led to the breakout of the 50,000 support zone, which then quickly caused a rebound into this new resistance zone. The last few weeks have again been characterized by the correction phase that has been dominating for two months now and recently even allowed Bitcoin to break through the important support zone of 40,000.

Outlook Weekly Interval

The massive bullish phase that has been ongoing since July 2021, emerging from the healthy 0.618 Fibonacci zone calculated since the start of the bull market and the all-time high in April, was on watch. Falling below the 40,000 range meant that rapid and continued price discovery beyond the all-time high of 69,000 was still a long way off at the moment. The market is slowing down with the risk of falling into a bear market.

The series of higher weekly highs and lows since October 2020 are intact, but falling below the 40,000 area has caused major cracks in the foundations. The weekly RSI (3), which despite an all-time high showed negative divergence from price action, had indicated that momentum was weak. The correction of recent months has impressively confirmed the image of this indicator.

Since hitting the new all-time high of $69,000 in early November, Bitcoin price has corrected by 50% in the meantime. Historically, such price behavior has often been observed even in bull market phases. With the new break through the 45,000 resistance, the chances of ending the recent corrective phase increase. The streak of lower highs since the all-time high has been broken, an important step for further price gains. The weekly RSI indicator should bring increased chances for a continuation of the upward movement if its downward trend, which has lasted for more than a year, is interrupted.

If the recent upside move fails and the price falls below the 40,000 area again, the ultimate decisive battle between the bulls and the bears will likely take place in the 34,000 area. Fibonacci of 0.618, which was calculated from the start of the bull market and the all-time high. A sustained decline below this range would also undermine the already disputed price zone in July 2021, which would come close to confirming a bear market.

All information in this publication is provided for general information only. The information provided in this publication does not constitute investment advice and is not intended to be. This publication does not constitute, and is not intended to constitute, an offer, recommendation or solicitation for any investment in any financial instrument, including cryptocurrencies and the like. The content contained in the publication represents the personal opinion of the respective author and is not intended or appropriate as a basis for decision-making.

Risk Notice
Investments and investments, especially in cryptocurrencies, are always associated with risks. The total loss of the invested capital cannot be excluded. Cryptocurrencies are very volatile and can therefore be subject to extreme price fluctuations over a short period of time.

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