Bitcoin recovered 80% without any government bailout – is it time to be optimistic?
Bitcoin is not giving up on money to succeed, so it might be the best time to buy, as various price indicators suggest that BTC’s minimum price may be close.
Bitcoin (BTC) price held within a relatively lateral move last week and not once tested the resistance or support of the descending channel identified in last week’s analysis.
As such, today 03/29 I am looking at a new bullish case for Bitcoin that could make the leading digital asset see incredible growth if the $ 7,200 resistance breaks on the technical side.
However, last week it demonstrated a massive fundamental turning point for Bitcoin that very few are talking about.
Bitcoin’s old way
If Bitcoin has resumed the downtrend as of July 2019, over the next week we should see how $ 5,600 is tested. This $ 5,600 level represents the middle of the descending channel, and from here you would be looking for a big rejection or a free fall to $ 4,100 as confirmation that this channel is still valid.
If this channel remains valid, this puts the resistance at $ 7,200, and it would be bearish again in the near term, perhaps even until the end of the year, expecting $ 3K of Bitcoin to be an area that we should not only hope to reach, but an area where we could stay for a while.
A new path to $ 7,200
In a more bullish outlook for the price of Bitcoin, there is an apparently valid upstream channel opening up, which might surprise many unsuspecting as resistance in the downstream channel is the moving average of the downstream channel.
As such, $ 7,200 could be a critical turning point for the king of cryptocurrencies, which could lead to a new resistance level at $ 8,300.
If this is the case, it would place support today around $ 6,060 and around the $ 6,100 level next week; and maintaining these levels would certainly be incredibly bullish for Bitcoin. And it’s not just the technical aspects that are strong either.
Last week, gold advocate Peter Schiff sent a smug tweet addressing all Bitcoin holders, saying:
“Congratulations to the Bitcoin hodlers. It seems like #Bitcoin may actually be meeting its status of an uncorrelated asset after all. All asset classes are recovering today except Bitcoin! ”
However, without knowing it, Schiff has just presented the most fundamentally optimistic case for Bitcoin. While the surge in world markets last week was a direct result of trillions of dollars printing out of nowhere, Bitcoin, however, does not need “stimulus packages,” “quantitative easing,” or “bailouts.”
Bitcoin recovered 80% from its recent floor, proving that Bitcoin has something far more powerful than these things. It has believers in its value proposition.
This to me is a great sign that Bitcoin will emerge from this global pandemic stronger than ever, but we may not be out of the woods yet.
The weekly MACD is not yet bullish
One of the best indicators for knowing when to buy or sell Bitcoin is the weekly Moving Average Convergence / Divergence (MACD) indicator. As you can see from the chart above, it crossed bullish eight months before the all-time peak (ATH) and bearish one month after the ATH.
It was also bullish when Bitcoin was on its floor in February 2019. However, there may be false crossovers, and this is what I warned people about in my analysis on December 8, 2019. Here I pointed out that the MACD was mimicking the patterns. We saw around the last bogus bullish cross, which saw Bitcoin drop from over $ 8K to under $ 4K, and as it happens, that’s exactly what happened again this month.
As such, I would suggest that perhaps the MACD is telling us once again, that the floor is in, and that now is the time to buy Bitcoin aggressively ahead of the next bull run.
However, I personally would like to see the signal lines and MACD peeking out before getting too excited, but if the new upstream is still valid, that’s exactly what we’ll see.
The bearish scenario for the price of Bitcoin
Despite all my optimism, you can’t ignore that Bitcoin’s mining difficulty had its biggest drop since December 2018, and it looks like there will be another big drop in April.
This could point to one more downside for Bitcoin, or it could point to higher profitability for miners, reinforcing my theory as to why miners collapsed Bitcoin earlier this month. If this has a detrimental effect on the price of Bitcoin, this will invalidate the upward support of $ 6,100 and put $ 5,600 and $ 4,100 as the levels to defend over the next week.
The bullish scenario for the price of Bitcoin
If the $ 6,100 support holds, then the next level to consider is $ 7,200. If this level turns into support next week, then $ 8,300 is where I’m looking for a breakout that could put $ 10K within the odds.
The views and opinions expressed here are solely those of @officiallykeith and do not necessarily reflect the views of Cointelegraph. Every investment and commercial movement involves risk. You must do your own research when making a decision.
Disclaimer: This press release is for informational purposes information does not constitute investment advice or an offer to invest. The views expressed in this article are those of the author and do not necessarily represent the views of infocoin, and should not be attributed to, Infocoin.