Disclaimer: This article is not intended as an investment advice and published for educational purposes only. BTC markets are highly volatile and risky in nature. DYOR before making any investment decision rather than listening to a stranger over the Internet.
Bitcoin and the rest of the crypto market is entering into an exciting phase. Cryptoriate published on 24 Feb 2019 that Bitcoin has either found a bottom or very close to do so, and time proved that the analysis was right. Two order blocks were emphasized as a confirmation: $4K-4.3K and $5.8K-6.1K and how a break above could declare the end of the current bear cycle. Bitcoin was trending around $3.5K on 24 Feb 2019, broke above and hit approximately $9K on 30 May 2019. It bottomed out in Dec 2018 at $3,158 and rose to a glorious figure of 9,096 USD, a rise of 185% in mere 5 months.
A fractal of 8 EMA and 100 MA crossovers on weekly time frame was also mentioned as another confirmation of the trend reversal and that crossover has already been printed on the charts.
MACD
A MACD with modified settings has also provided a strong buy signal. These modified setting have produced crossovers (indicating a potential buy or sell) only 9 times throughout the history of BTC: 7 were true providing 77.78% accuracy rate. The other 2 times, the inverse crossover occurred within 8-10 weeks reversing the false signal. The latest Buy signal has been printed and MACD Crossover was confirmed on 1 Apr 2019, BTC was trading at approximately $5,300 at that time.
Below is a picture of the crossovers. The green lines indicates the crossover to buy and true, red lines are a crossover to sell and true, and yellow indicates the crossover to either buy or sell but did not pan out and reversed shortly after.
RSI (14)
The 2014-15 bear marker concluded the cycle after hitting a low of 27 on RSI, the 2018-19 bear market is showing a strikingly similar pattern. The RSI dipped to 29 in Dec 2018 followed by a massive spike coupled with massive price hike.
The RSI has risen above 50-55 for the first time since Jan 2018. This parabolic rise indicates aggressive buying pressure. If this the end of the bear market, RSI should not dip below 50-55 on weekly time frames for a long time.
A notable development is that the RSI and price are moving at a much faster pace as compared to 2015.
RSI (34)
Modifying the RSI setting to 34 reveals an interesting line and contributes further clues towards the trend reversal. The number 49 is critical in this setting. In 2014-15, as RSI rose above 49, it marked a trend reversal. See how it is started printing higher highs and higher lows until Dec 2017 when it dipped, followed by lower highs and lower lows.
2019 is showing a similar pattern. RSI has shot past 49 now and printing higher highs and a higher low is expected soon.
Is this is end of the bear market?
It most likely is. There are several indicators which are pointing at the end of the bear market. You can say that most of the bears are either dead or back to hibernation for a long period of time. Many other assets have also risen more than 100% such as EOS, TRX, and XRP from their ATL (All Time Low), while as some alts are struggling but occasional volume spikes indicate that they are in accumulation process and close to finishing their bottom-out process. BNB went to $4.20 in Dec 2018 and, at the time of writing this analysis, trending at $34.
Latest Developments
Now that it has been explained in detail that why we believe that Crypto Winter is over, let’s dive into the current and future possible scenarios.
The BTC has started an uptrend and many investors are waiting for a pullback ever since it surpassed $6,000 but the price has not retraced much. BTC is staging a retracement now and it could go as low as $5.5K from the current price of 7.6K USD.
The following weekly chart is a summary of important support and resistance levels to observe:
On the weekly TF, strong support levels are the confluence of 100 MA and 38.2 Fib around $6.8K and a confluence of 50MA and 61.8 Fib around $5.5K. The volume is in the favor of bulls. Any pullback is being aggressively bought without price dipping a lot. The green order blocks represent strong support levels.
On a 3D time frame, $7.2K is an interim support level.
There is an overhead resistance at $8.2K, followed by a psychological resistance block spanning $9K-10K. There is a confluence of resistance at $9K-10K which makes it harder to surpass at this stage.
A weekly close above 10K could push BTC to $11.5K. The other resistance levels are highlighted by red lines in the chart.
Conclusion
We strongly believe that BTC bear market is over and BTC is gearing up for an uptrend. As per the technical analysis, a pullback as low as up to $5.5K is on the horizon but will not invalidate the price uptrend and considered only a retracement. A weekly close below $5.5K will invalidate any bullish continuation and further analysis will be required to form an opinion. The following chart is a cleaner version of the above-mentioned critical levels to observe. Green lines represent support areas and red lines are where BTC is suspected to find selling pressure.
Disclaimer: This article is not intended as an investment advice and published for educational purposes only. BTC markets are highly volatile and risky in nature. DYOR before making any investment decision rather than listening to a stranger over the Internet.
