After the parallel channel breakout, Bitcoin’s price has managed to sustain a positive position around the $50,000 position, seeking the next trend-setting move. The $50,000 position has been seen again in the Bitcoin chart in early September 2021, when the price hit a local high level and then turn back to lower levels.
The previous hit around the $50,000 level was a correction marker but the market situation was completely different back then. The market (in September 2021) was trying to break the consolidation market around $47,000, with multiple trials, that went eventually successful after a dipping around $41,000 and the skyrocketing move at $65,000 in less than a month.
The current market situation is a corrective trend that started from mid November 2021 and have tried several times to stop this downfall, by creating multiple stages of support. The multiple levels of support lay on the channels between $58,000 and $54,000 and the lower one, between $52,000 and $48,000. The second support level proved to be stronger.
The positive breakout can brought the market in a new status as there is a turning point between the two channels. The negative scenario will be a return in the parallel channel below $50,000, a move that will continue the ranging period and deliver more time for another positive breakout.
The positive scenario will be an uptrend towards the $54,000 level, a move that will drive the price until the $60,000 level. The driving forces that will determine the next trend will be:
As Central Banks will try to halt the inflation wave, Bitcoin will react according to traditional markets’ reactions, possibly with positive correlation. The long-term inflation period could lead the crypto market to an explosion as investors will try to find alternative assets that will overperform against inflation, due its deflationary nature.
We expect that the conversion between fundamental and technical analysis will bring us on the verge for the new trend that will be settled in the upcoming period.
The moving averages crossed each other in a bullish position, indicating that the market has consolidated a critical mass below the $50,000 zone, that considers the bearish market as a past event. In periods when ranging is the main trend, the moving averages crossing could be a distracting signal, as the moving averages will cross each other multiple times and create signals for bullish / bearish trends.
The trading volumes have been sustained at normal levels, without any exceptions for the current period.
In the short-term chart, we can understand that the price has passed clearly above the parallel channel, waiting for the next move that will bring the next trend in the chart.
The waiting period would stand for more as a new driver will dominate the market and make another trend to become evident in the next days. As we said in the previous paragraphs, only a negative turn will set the market in a ranging period, with less surprises on the way.
The day-trading dimension for the Bitcoin market has created an interesting pattern that it could be difficult to exploit at the certain moment. The price remained for several hours and days around the $51,000 level, without being able to break it in the next level.
After failing to break this zone, the price went down to $50,000, showing that small losses in the short-term period could become a massive trend in the long-term. We might expect a new support zone above the $50,000 zone that will lead the market in the next high zone, with more probabilities to achieve a better result in the mid-term period.
The trading volumes slowed down during the weekend, indicating that the new week might bring a new trend that will pass us on the 2022, with a positive result.
MACD index continued to stay in the positive side, bringing more positive vibes about the upcoming period. The momentum tracker can become a critical factor in the market structure as it will bring fast upscale, breaking more and more resistances in the higher levels. If the momentum starts to lower in the next days, an uptrend is less likely to happen as the market wouldn’t have any power for a short-term explosion that will climb the price to the next level.
The RSI index has moved to value = 50, indicating that the market will remain stable for the next days, while the Simple Moving Average (of 14 days) remains below value = 50. This means that the market could remain undervalue for some more days, making some investors to think it could be a proper time to jump in the market.
After breaking the parallel channels, the price will try to find its steps around the $50,000 zone. The next steps will be determined both from technical and fundamental factors that needs to be examined before a new move in the Bitcoin chart.
We remain optimist (in a restraining way) and we hope that more opportunities will emerge in the upcoming week as the end-year rally will made its final trial to beat expectations and establish another bullish trend, aiming higher price targets.
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