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Bitcoin Price Analysis: A reality check at $41,000 for Bitcoin

After hitting the $44,000 line, Bitcoin finds it hard to sustain a positive profile and the profit-takers have made a strong case in this period. This move led the market to correct at $41,500 and get back in the consolidation zone.

Bitcoin Price Analysis: BTC / USD – General Overview

 

After hitting the $44,000 line, Bitcoin finds it hard to sustain a positive profile and the profit-takers have made a strong case in this period. This move led the market to correct at $41,500 and get back in the consolidation zone.

The consolidation zone lays between $35,000 to $40,000 and it will probably be the next case for the upcoming period. As we can remember from the summer of 2021, the consolidation period between $32,000 and $40,000 remained for 2 months, before the market manages to break out and establish another bullish trend and finally, an all-time high level at $69,000.

 

Practically, we are already two months in this zone but there are more breakouts than the previous time. Of course, the triple peak at $44,000 is a positive signal for the market structure as it shows that the Bitcoin market can reach higher levels, even during this consolidation. If the Bitcoin market manages to break the consolidation as soon as possible and has constant high levels in this zone, then a new all-time high level is possible to be achieved in the next bullish wave.

 

The moving averages crossed each other, creating a bullish signal. This signal might be misleading now, as the market has created a reverse momentum and the market is moving on the other side. The best way to exploit this signal is to wait for the short-term action to happen.

 

The trading volumes have been sustained at normal levels, showing that the investors have kept their usual activities and their positions in the Bitcoin market.

 

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

Bitcoin / US Dollar: Short Term Overview

 

This curve in the short-term window shows that the market has been more volatile than expected in the last few days, creating opportunities for investors to “buy the dip” and get rewarded immediately.

 

In this period, we should highlight that the Ukraine situation has played an important role in the Bitcoin price formation. The first news after the Russian invasion was correlated with the traditional markets’ approach, whose reaction was negative and bearish. Every analyst was expecting much more negativity and stories that could lead the markets to a much worse situation.

 

In the aftermath of this event, Bitcoin was highlighted as an alternative solution for Russia to overcome sanctions and bans from the central financial system and the SWIFT transaction system. This lead the market up to previous price levels, while today the market started to correct again.

 

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

Bitcoin Price Analysis: BTC / USD – Indicators

 

MACD index passed on the positive side after the $44,000 point conquer but this was a temporary result that lead to another drop in the Bitcoin market. The positive momentum seems to fade out for now and a new trend could emerge anytime soon to conquer the market and establish a new phase for Bitcoin.

 

After reaching value = 60, the RSI index moved down to value = 50, showing that the price would remain in the consolidation zone for the next days at least. We know that geopolitics and the traditional markets are playing an increasingly important role at this moment, in the price formation process but the indicators could show us a perspective for the next steps.

 

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

Bitcoin / US Dollar: Day Trading Overview

 

The day-trading view of the Bitcoin Price Analysis showcases a nice volatility example in the 4-hour span, which can create more opportunities for day-traders. Excluding the signals at late 23 February, 3 out of 4 signals in the last 10 days have been proved right.

 

The bullish signals at 25th, February and 1st, March created returns of 8 % and 9 % respectively in 8 – 16 hours, showing that the market was prepared for another bullish run in the next period. This was also added from the fact that the bearish signal on 28 February was wrong and was strongly affected by the instant correction on 27 February.

 

Last but not least, the signal that appeared yesterday was a bearish opportunity for the investors and has been confirmed at least for the first hours. At this moment (morning of 4th March) the accumulated return for this trade has been to 2 – 3 % and the expectation is to grow during the days, peaking 8 – 10 hours after the signal appearance.

 

All this information should be taken into consideration as the consolidation zone and implement more volatility in the day-trading window, allowing day-traders to exploit more and more positions faster.

 

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

Bitcoin / US Dollar: Day Trading Indicators

 

From this Bitcoin Price Analysis and on, we will introduce MACD and RSI indicators for the day-trading view also. This could help us understand better the transition from short-term trends to the major ones and also find more signals that could help improve our day-trading process.

 

MACD index (Moving Average Convergence Divergence) shows us that there are several bullish hiccups during the last few days, which can be correlated with the sudden price reaction from $38,000 to $44,000 in a single day. Those reactions can be measured accordingly as we can see the pass from minor trends in the short-term window to the major trend established in the general overview

 

The RSI index (Relative Strength Index) gave its last signal on March 1st when the price reached the $44,000 level but there was a need for waiting 1 – 2 days before the signal got confirmed. This means that the indicator could be used as a complementary signal for the moving averages.

 

We would do more back-testing and the results will be here.

 

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

Bitcoin Price Analysis: Conclusions

 

Bitcoin has corrected $44,000 to $41,000, showing that the market is not ready for another bullish wave. The volatility in the day-trading charts could be exploited and deliver some promising results for traders.

 

You will see more from us in the next articles!

 

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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