Bitcoin Analysis — Week of April 10

Last week we said:

Looking at the same chart with RSI, we can see that Bitcoin became slightly overbought and is now correcting. I expect this to be a minor bull flag or period of consolidation before testing all time highs around $62k. If Bitcoin breaks this level, the bullish decision has been made and a new ATH is likely to be set.

This is exactly what happened over the past week! Bitcoin broke its ATH and set a new ATH just under $65k! Since setting that new ATH, BTC has retraced and tested the $60k support level, which held before bouncing back up to $62k:

Let’s see if we can look at the charts & get an edge on market movements for this coming week.

Price Analysis

BTC/USD 4H Chart from Tradingview

One possible scenario is that Bitcoin is forming a bull flag consolidation pattern before continuing the upward trend. If market fundamentals are any indication, this Bull run is not over yet. Key levels for this scenario is the $60k support, and current resistance at $63k.

BTC/USD 4H chart, Moving averages

Looking at the same chat with moving averages, we can see support levels below $60k. If $60k fails to hold, the next support is at the $100MA which is just beneath at $59.5k, followed by the 200MA at $58k.

BTC/USD 4H Chart, RSI

Looking at the chart with RSI, we can see that this scenario seems quite likely. When BTC formed its ATH earlier this week, the RSI was heavily overbought. A period of consolidation made perfect sense, since the RSI has to reset for the bull trend to continue.

BTC/USD Daily Chart, Tradingview

To get a long term perspective on price movements, we turn to the daily chart. As you can see, there’s a clear pattern forming here. Every time that BTC sets a new ATH, the RSI is overbought — followed by a period of consolidation before resuming the bull trend. The only difference is that in this most recent ATH, BTC was not as heavily overbought — indicating that there is more room for a significant upward spike.

Investor Sentiment

Fear/Greed Index, taken from Alternative.me

The FGI gives us an indication of whether the market is due for a correction. Typically a reading of “Extreme Greed” means we are due for some downward price movement — or at least a period of consolidation. This is likely, as our price analysis has also shown.

Fundamental Analysis

Earlier this week, Glassnode reported that a strong support zone had formed with BTC on-chain volume at $62.7k. Since this support zone failed to hold, it is likely that $62.7k will become resistance in the short term. This aligns well with our target $63k resistance level.

Conclusion

Bitcoin has set a new all time high, just as we predicted, but is now looking like it needs to cool off before resuming. All of our indications suggest that this is the most likely path. I would expect the $59–60k price level to hold, and if not — then $57k below that will almost certainly hold. Bitcoin’s fundamentals remain strong, and a period of consolidation is simply refueling for the next leg up.

Not financial advice, do your own research.