TL;DR the next 24 hours are critical.
Bitcoin has seen a lower high again, with its recent failure to hold the $4k level. After the fakeout and consolidation in the high $3,900s, yesterday bitcoin dumped back down to a low of $3,850 – the 200 MA on the 4h – before bouncing back to around $3,900.
This move broke the rising support line we have seen painted over the past several weeks, since early February. At the time of writing, the price is sitting right on that line; we will pay keen attention to where it closes. However, what we can say is that there are multiple resistance zones to the immediate upside. To the downside, we have the 50-day MA at $3,800, the 100-day at $3,700, and historic support at $3,600.
On the weekly chart, the picture becomes much clearer. We have a series of flat candles, with price rising weakly on very little volume. The trading range is very small – we have not seen this lack of volatility for around two years.
In wider crypto news, we see repeated research and reports stating that up to 95% of crypto trading volumes are fake – something that many traders have long known, but that is now being quantified and coming to much wider attention. This plays into the narrative of a low-volume price rise, ahead of a potential wave 5 or significant move to the downside.
Meanwhile there is no more news on the bitcoin ETF, with no approval expected from the SEC until nearer the end of this year. Bakkt, too, is quiet: the CFTC has said they are diligently working on Bakkt’s application, but it’s another ‘no news’ situation – an update that tells us nothing new.
These are conditions – fundamental and technical – that beg for a big more. The underlying picture for Bitcoin is great: rising hashrate, strong network and so on. But the sentiment and the immediate picture for traders is bleak.
Embrace the darkness. And enjoy it while it lasts.
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