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Bitcoin Price Analysis: After The Weekend Shock, The Market Recovers

Normally, the weekends were a calm and quiet period, even for the crypto markets, whose action was moving around minor trends, without changing any momentum or trend in this space. This didn’t happen over the past weekend!
Bitcoin Price Analysis: After The Weekend Shock, The Market Recovers - graph featured image

Bitcoin Price Analysis: BTC / USD – General Overview

Normally, the weekends were a calm and quiet period, even for the crypto markets, whose action was moving around minor trends, without changing any momentum or trend in this space.

 

This didn’t happen over the past weekend, as the price broke the $40,000 support level and slip down to $38,000. This made the inverse “Head & Shoulders” pattern hold a passive stance for now unless there is a sharp uptrend for now.

 

As we have noted in the previous article, the inverse “Head & Shoulders” pattern indicates that after the second “Shoulder”, a sharp move is likely to follow, on the bullish side. We should wait a couple more days to confirm this pattern, otherwise, it will go in the garbage bin.

 

The price around this level, belongs into a buffer zone between a bullish and a bearish period, as there is no clear signal about support or resistance zones. The next support zone lays at $35,000, which is the current local bottom. If this scenario came into reality, we should expect another consolidation period of around $35,000 as more and more investors would be skeptical to enter the market.

 

On the other hand, if the inverse “Head & Shoulders” pattern got confirmation, we should expect a fierce return in the market. The sharp turn in the bullish side would be marked if the price rises over the $45,000 line and continue from this point and on. In the bullish scenario, we should also indicate that the $44,000 level would act as a resistance point, needed to break if the market turns bullish.

 

The moving averages cross each other today, in a bearish formation, which should be considered twice before taking any action. The reality is that a bearish signal would lead the market in the $35,000 but there is no bearish momentum for another slip below that point.

 

The trading volumes are moving to lower levels than normal, showing that the market is trying to find another established trend or movement that will make more investors get more active and take long positions.

 

The overall expectations for a short-term period between $35,000 and $40,000 have been vanished for now. As the previous bearish period lasted around 2 months, with ups and downs between $32,000 and $40,000, we might experience another consolidation period with smaller price volatility and ranging actions for the next months.

 

As we are entering the second month on those levels, we might be able to see another pattern that will confirm our expectations towards this.

 

Bitcoin / US Dollar: General Overview
Bitcoin / US Dollar: General Overview in Bitcoin Price Analysis, image from Tradingview

Bitcoin / US Dollar: Short Term Overview

Looking at the previous 3 weeks in the Bitcoin market and at our previous Bitcoin Price Analysises, we can observe the full inverse “Head & Shoulders” pattern to be described in the charts. The $40,000 point remains as the most crucial point in this period for a breakthrough move and the passage to the bullish period would be harder than expected.

 

As usual, strong moves are trying to set new trends in the market but there is a need for a multiple of them and on consequential movements. Until then, sharp moves will just float around the price in the same price range.

 

Bitcoin / US Dollar: Short Term View
Bitcoin / US Dollar: Short Term View in Bitcoin Price Analysis, image from Tradingview

Bitcoin / US Dollar: Day Trading Overview

In the day-trading window of this Bitcoin Price Analysis, there was another confirmation in the day-trading strategy regarding moving averages cross. In the last hours of 17 February, a bearish cross appeared in the market chart, indicating that the next hours will probably find the Bitcoin market in the reds.

 

Since the signal was given in the Bitcoin charts, the price has fallen around 10 %, confirming the signal and marking another success in the day-trading strategy that was evident in the last articles.

 

We believe that the proposed strategy in this time frame works better when the market is ranging and multiple signals can offer more and more trades with major or minor successes.

 

If there is a clear trend on the bullish or the bearish side, any signal towards the opposite side could vanish into hours and only stop losses orders could make our portfolio effective in this positioning.

 

Bitcoin / US Dollar: Day Trading View
Bitcoin / US Dollar: Day Trading View in Bitcoin Price Analysis, image from Tradingview

Bitcoin / US Dollar: Indicators

Let’s check MACD (Moving Average Convergence Divergence) index in this Bitcoin Price Analysis! It has moved for 4 consecutive days on the “red” side, showing that there is more negative momentum in the market. The negative price action would probably continue according to the index but we should take into account more parameters and test more strategies around it.

 

The RSI (Relative Strength Index) index moved between values 40 and 45, which means that the market has passed in the bearish zone, with more negativity to remain in the market and shape the next day for the Bitcoin market. The most probable scenario according to the RSI index is the consolidation around this level at $40,000.

 

Bitcoin / US Dollar: Indicators
Bitcoin / US Dollar: Indicators in Bitcoin Price Analysis, image from Tradingview

Bitcoin Price Analysis: Conclusions

As you seen in this Bitcoin Price Analysis BTC dropped during the weekend at $38,000, marking a new correction in the current trend. The market reacted immediately today, climbing at $39,000 and showing that the route to $40,000 is close enough to be achieved.

 

The overall image in the market can be depicted as a long–term consolidation period between $35,000 and $40,000, with spikes around it. A similar pattern was evident in the summer of 2021 when the Bitcoin price was floating between $32,000 and $40,000. This cycle broke after 2 months, leading to another bullish trend and the all-time high level at $69,000.

 

A similar scenario can be expected in this situation in the mid-term prediction, with more power from institutional investors and overall adoption from larger masses.

 

Read our previous Bitcoin Price Analysises here!

George Foroglou

George Foroglou

George Foroglou heard first time about Bitcoin in a Christmas dinner in December 2013. As Finance student, he published articles regarding Bitcoin adoption, blockchain applications and IoT monetization strategies. From 2017, he is an active trader in the Bitcoin and other altcoins market, using mostly Technical Analysis. He has worked for plenty web portals, giving insightful articles about technical and fundamental analysis.

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