“What is the price of these Bitcoins you keep talking about?” Asked a friend. I look at my phone and it is still around $ 9,200. “About the same as last month,” I replied.
The price of Bitcoin (BTC) has hardly budged an inch in the past six weeks, barely moving 2% back and forth from its average price. Therefore, I’m starting to think it’s a stable currency now.
Bitcoin’s current stablecoin period looks like early 2017
However, this long period of static pricing reminds me a lot of the start of 2017, when Bitcoin stayed around $ 900 for the first three months of the year, followed by an explosive move of 300% in the second quarter, and then continued .
Daily performance of the cryptography market. Source: Coin360.com
The question I am asking myself now is whether we can really expect this to happen in 2020 now that half the year is behind us, or if Bitcoin has just passed and is waiting to fall.
We all know that the first quarter of 2020 was a brutal one for Bitcoin. However, after the Black Thursday dump in March, the lucky ones who bought downstairs have already seen a huge 180% return on their investment.
It would be naive for anyone not to expect some of these people to make a profit, so a period of consolidation is completely natural.
However, what makes BTC very different from other assets is the position in which miners find themselves. They have 50% less Bitcoin to sell than before, and the effect of consolidation after the mini-bubble has placed BTC / USD in a downtrend.
1 day BTC / USD chart. Source: TradingView
At the same time, Bitcoin is less than 1% out of this downlink. The current price of Bitcoin is just under $ 9,300 and the resistance of the downlink on the daily is only $ 9,350.
It also puts the median support around $ 8,900 and the final support before reporting a larger drop to $ 8,350. From there, all hope of an immediate bull run would be lost.
The hopium approach
By zooming out on the weekly chart for Bitcoin and drawing the Fibonacci lines using the 2017 ATH peak at the bottom of 2019, we can see that BTC has been hovering around 0.382 Fib for several weeks, sometimes crossing, and getting sometimes crossing.
1 week BTC / USD chart. Source: TradingView
With Fibonacci trading, you look at the following levels as potential targets, and generally once the 0.382 has been broken after increasing by 0.236, the next level is the Fib of 0.5 or 50%, which is at $ 11,500.
If the 0.382 of $ 9250 can become a support during the week to come, the bears are in bad shape. Conversely, if the support of $ 8,350 does not hold, it is a long way to go for Bitcoin to find new support on the 0.236, which places the bearish objective at $ 7000.
MACD shows signs of reversal
1 week MACD BTC / USD chart Source: TradingView
In last week’s technical analysis, the weekly MACD looked very “weak” and was expected to bearishly cross. A cross up or down on the weekly MACD are pivotal points for Bitcoin. Just browse the history of price action against the MACD to see that it’s the only indicator you need to time your Bitcoin purchase and sale.
However, thanks to last week’s mini-alt season, it looks like interest in Bitcoin is on the rise, and this is reflected in the blue MACD line changing its trajectory from bottom to top.
When the MACD opens like this on shorter time frames, it is a trader’s worst nightmare if he did not wait for confirmation because it is a very early sign of a trend reversal. In other words, Bitcoin bulls are not yet ready to capitulate to bears.
Diversify, attach or HODL?
Tether market capitalization Source: Coin360
Normally, during consolidation periods, Bitcoin traders have the choice of placing their realized profits in Tether, which gives them the luxury of buying the drop easily or going in on confirmation of a bullish reversal.
However, in a recent Forbes article on an official investigation into Tether and his rapid approach to a $ 10 billion market capitalization in the wake of Brock Pierce recently announcing his intention to run for president of the United States, I would be nervous about holding any amount of USDT right now.
As such, it seems likely that much of that $ 10 billion parked in Tether would logically start to head for Bitcoin and high-level altcoins. This would explain the recent increase in altcoins and affect Bitcoin’s prospects in the immediate future.
If the price of Bitcoin can exceed $ 9,350, there are a few key areas of resistance that need to be overcome before $ 11,500 can be reached.
First of all, there is a large sales wall around $ 9,500 on Binance, according to the Tensorcharts heat map. After this level, attacking the multi-year resistance level of $ 10,500 seems to be back on the cards, and with all the fud Tether, it’s a scenario that seems quite promising.
Thermal map of the order book. Source: Tensorcharts
Using the same Tensorcharts heat card, there is a huge purchase order before support from $ 8,900 to $ 8,990. If this level cannot be maintained, I would consider $ 8,350 as the next level so that the downward channel of everyday life remains intact.
A break below $ 8,350 could open $ 7,000 BTC as a harsh reality in the short term. However, with Tether potentially out of the table in the short term, I doubt the bears will have a good week.
The views and opinions expressed here are solely those of @officiallykeith and do not necessarily reflect the views of Cointelegraph. Each investment and trading movement involves risks. You should do your own research when making a decision.