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Bitcoin Price Analysis: Another Week in Compression, The Opportunities in Day Trading

Another week in the Bitcoin market when the price didn’t manage to touch any breakout points and the compression remained intact for this week also.
Bitcoin Price Analysis: Another Week in Compression, The Opportunities in Day Trading - BTC graph as featured image

Bitcoin Price Analysis: BTC / USD – General Overview

The fact that the triangle is tested again, shows that there is more and more evidence that the compression would continue to exist and produce results.


The expectations at this moment lay on the fact that the price would drop again around $37,000 to complete the triangle formation and start the breakout from this point and on. If the breakout becomes a reality in the next period, we expect to break the first resistance point at $44,000 and continue to thrive until the next recovery point at $47,000 – $48,000.


At this moment, the price floats around $40,000, which remains the average return point for the current trend. This means, as we have highlighted multiple times in those articles, that every single move in this trend will return to this point, either on the bullish or the bearish side.


The previous experience had shown us that similar compression zones tend to last for 2 months at least. Today, we are marking exactly 2 months since the dip at $35,000. This means that any time soon, a breakout could change the price mode and deliver more and more value to long-term investors.


The breakout will probably happen if there is another huge announcement from a large corporate regarding Bitcoin adoption or a country that recognizes Bitcoin as a legal tender. This could happen during 2022 or at a later stage, making Bitcoin stronger on a fundamental basis and looking into the future with a bright side.


The moving averages have not crossed each other yet but they are ready to, creating a bullish signal that would a potential-jump towards the $44,000 resistance level.


The trading volumes have created a pattern with consequential spikes, showing that traders and market makers have made several plans for the current situation and they are ready to take advantage of it. Those ups and downs in the trading volumes are also a signal that short-term investors are taking multiple positions over weeks and they are trying to buy and sell with maximum profitability.


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

Bitcoin / US Dollar: Short Term Overview

The triangle formation is much clearer in the short-term window. The formation could break down if the market starts to grow above $41,000 and create a clear path to $44,000. Even if the price manages to climb at $44,000, there would be a need for a major move that will establish the price above this level, with higher expectations.


The sudden moves are always those that break any resistance or support levels as they deliver price action that couldn’t be evident in different situations. The patterns will also be helpful in this situation as we could gain some insights before this happens.


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

Bitcoin / US Dollar: Indicators

MACD index returned to the “green” side, establishing a fair early bullish position, with a slight change in the price formation. The short-term bullish situation could last again until the price reaches $44,000 when the market will be tested again.


The RSI index moved above value = 50, showing that the direction might be different for now but the expectations still lay on the steady side. The price movements will retain the compression zone until there is a major change that will bring the market into another situation.


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

Bitcoin / US Dollar: Day Trading Overview

The signal that appeared on Tuesday 15th March and we write about it in the previous article, was confirmed !!! The price moved to 4.8 % up in 2 days, making day traders happy and more people looking for opportunities in the day trading window.


Of course, we need to highlight that the strategy we discuss here around Bitcoin’s price actions can work better in consolidation modes, where the price can return on an average point and create multiple bullish and bearish signals.


If the situation changes, we expect that signals in the opposite direction could be proved wrong as the market momentum will evade them at all costs. Again, we should be careful on short-term trading as the stakes are higher and the involved risk could be proved devastating.


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

MACD index (Moving Average Convergence Divergence) confirmed the signal that was given on March 15th. Practically, the index had given a preamble on this situation by passing on the “green” side a day before this. Now, the index is moving down and the probabilities for passing on the other side are also increased.


The RSI index (Relative Strength Index) is still calm without producing any major signals. As we have told in previous articles, this index could be used in the future, once the market has a more clear direction.


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

Bitcoin Price Analysis: Conclusions

The bitcoin market for the last 2 months has been stagnated between $36,000 and $44,000, creating a compression mode. This mode has an average price of $40,000, which has been the “return-to-the-mean”.


The triangle pattern could mark some progress on the bullish end but the real deal will come when the market will be ready to break the resistance point at $44,000 and march towards new high levels.


The setup is better than the previous times and the only thing that remains is a favorable situation that will bring the price to higher and higher positions. Until then, we wait and look for opportunities in the day-trading window.


Read our all previous Bitcoin Price Analysis 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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