BOTS crypto news week 10
Bitcoin broke its old all time high this weekend and even broke through the 60,000 US dollar barrier. And this while two weeks ago many people were still wondering if the end of this bull cycle was near. Enormous volatility is a characteristic of the crypto currency market, but it can be very frightening. In this crypto market update I'll put everything in order and I'll look ahead to next week.
Bitcoin has fully recovered from the correction in late February. Bitcoin even made a new all time high above 60,000 US dollars. Currently, Bitcoin has dropped a bit and is trading around 55,000 US dollars. What can we expect from Bitcoin in the coming week?
It can be seen that Bitcoin has been in a rising channel since the last correction. Bitcoin broke out of this channel, but it did not last long as there was not enough buy pressure . Due to the low buy pressure, bearish divergence is now visible on the macd. This can be deduced from the fact that the macd is making a lower low, while price is making a higher low. The bearish divergence has already started to develop, but has not yet had an extreme impact on price. I expect that if Bitcoin drops further, the bottom of the channel can provide good support.
Below I look at the horizontal support and resistance zones for Bitcoin. Currently 55,000 US-dollar is offering support. If this support is broken, the next support zone around 52,500 US-dollar will be tested. The bottom line of the rising channel, which was discussed above, also lies around 52,500 US-dollar.
I see absolutely no reason for panic at the moment. After a new all time high we are currently testing support zones that were once resitance. That is how the market works. It is very healthy.
Two weeks ago, I shared the chart below of Bitcoin as well. The chart shows Bitcoin on a monthly time interval. Since people are not always interested in short term fluctuations, I am sharing this chart again. What stands out is that there hasn't been a single red month since September. In the summer of 2020, Bitcoin broke out of a huge symmetrical triangle. The measured move of this consolidation pattern is around 66,000 US dollars. A horizontal resistance can also be seen on the rsi around 96. Currently we are around 92 on the rsi. In 2017, Bitcoin reached the 96 on the rsi twice. The first time Bitcoin corrected 36%, this caused the rsi to reset to around 89. After this reset, Bitcoin grew another 400% and reached an rsi of 96 again. The second time Bitcoin reached 96 rsi also marked the end of the bull run.
Last week I indicated that Ethereum was looking very good; even better than Bitcoin. The blue resistance line was broken after a somewhat unorthodox head and shoulders pattern. Currently we are testing support and I think a bounce is likely. Two weeks ago - when Ethereum was around 1400 US dollars - I mentioned that I expected Ethereum to return to its all-time highs and I still do, as long as this support holds. The Ethereum/Bitcoin chart is also looking good, but I'll elaborate on that in the course of this week. Then there will be a sequel to the article written in December: 'What can we expect from Ethereum and altcoins in Q1 2021'.
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