The price of Bitcoin (BTC), the highest-ranked cryptocurrency, is currently around $ 9,000, following last week’s impressive 20% rally in one day. With the halving now in less than 2 weeks, it might seem obvious to spend a long time on Bitcoin to catch the next explosive move.
However, there is a graphical view that suggests that we may have passed, and that’s what I’m going to start today.
Daily performance of the cryptography market. Source: Coin360.com
When in doubt, zoom out
BTC USD daily chart. Source: TradingView
In last week’s analysis, I shared two possible upward channels, one of which was invalidated by leaving one in play. This week I want to explore the possibility that we are not in one or the other. another channel and the fact that we could still be in a downtrend since the pump of June 2019 which almost reached $ 14,000.
The upper trend line is validated by three keys. However, the lower trend line for this channel places the immediate downturn at $ 3,000 with a moving average around $ 6,300. These are not numbers that I expect Bitcoin to review, but it would be foolish not to prepare for them.
Fib hints at what an escape might do
BTC USD daily chart. Source: TradingView
Fibonacci’s retracement levels from Bitcoin’s $ 20,000 ATH show us that a breakthrough today could see us return to levels much higher than expected.
$ 9,550 is the critical level to focus on. This is both Fib 0.382 and the top of the channel. Claiming this level could see Bitcoin soaring towards the 0.5 Fib of $ 11.50.0, which then realistically puts the 0.618 Fib of $ 13,500 on the table.
Now all is well, but “the number is increasing” does not always happen, and one of those indicators that we can trust to confirm the direction in which we are heading based on current dynamics is the monthly indicator of moving average convergence divergence or MACD.
MACD monthly analysis
MACD BTC USD monthly chart Source: TradingView
Last week, I highlighted the importance that the moving average divergence (MACD) convergence indicator has on the price of Bitcoin when it rises bullish over the weekly period.
However, with the bullish monthly close of the candle, a new picture appeared for the monthly MACD. Above, the monthly MACD bullish and bearish crosses with the weekly MACD bullish crosses highlighted with the dotted lines – green for the bullish crosses that had a great run afterwards, and red dotted lines for the false bullish crosses.
The reason for this card is to see if there are any models that match the 2017 weekly bullish crossover which has seen a 2000% increase. But it is also useful to see if the view of the higher period shows us a contradictory impulse which might suggest a drain soon.
Moving from left to right of the graph, this shows that, in March 2017, when the weekly MACD crossed bullish, the monthly MACD was already in a bullish cross since 2015.
Thus, at the point of the weekly bullish crossover, the MACD and signal lines were on an upward trajectory. This resulted in a 2,000% increase in the price of Bitcoin from the weekly crossing point.
Later, the false bullish crossover from the weekly in September 2018 shows us that the monthly MACD and the signal line were both in a downward trajectory and that the monthly MACD was already crossing in a bearish direction. Thus, the higher time momentum signaled that the passage of the weekly MACD crossover might not be valid.
The weekly bullish crossover for February apparently has exactly the same conditions as the crossover for September with a difference. The histogram on the monthly MACD lost its downward momentum, as shown by the lighter pink color compared to the darker pink in the previous crossing. In this case, it resulted in a 400% increase in the price of Bitcoin.
Now looking at the momentum of 2020, we can see that the monthly MACD cut and changed direction between December and February, which led the signal line and the MACD to a sideways trajectory – literally a first for Bitcoin.
But if you’ve read this far and still follow where I’m going with it, the monthly signal line is on an upward trajectory for the first time since October 2015, when Bitcoin was only $ 200 per piece, and if you take that to a record level of $ 20,000, it’s a monstrous movement of 10,000% or 100x.
So, with that in mind, will the next bullish cross of the monthly MACD take place in June? Are we in store for a 10,000% increase over the current price? Only time will tell.
Bitcoin starts to crash
1 hour USD BTC chart. Source: TradingView
Going down on time now, and we can see that Bitcoin was starting to form a pattern of lower ups and downs after its big step last night.
In general, this indicates a potential continuation of the previous trend, and the upside potential is around $ 9,600. And if we had maintained that level for a daily candle close, next week would have been incredibly bullish.
As it has just collapsed, a drop to $ 8,400 throughout the week is expected.
The views and opinions expressed here are solely those of @officiallykeith and do not necessarily reflect the views of Cointelegraph. Every investment and trading movement involves risks. You have to do your own research when you make a decision.