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Bitcoin price kept supporting $ 8,500 when COVID-19 sparked fear for the global market

Bitcoin price is reversing? The major resistance at $ 7,600 has been broken

Today, the Bitcoin bull has found momentum and tried to reverse the trend of digital assets even when the global stock market is at risk of being threatened by corona virus (COVID-19).

The Dow Jones index closed down with 1,100 points (4.4%) and lost more than 10% in the past week. The Nasdaq Composite also dropped 4.6% to 8,566 points and the S&P 500 suffered the same loss – down 4.4% to close at 2,987 points. According to market analysts, today's decline is the largest daily decline in recent history.

Daily cryptocurrency price chart. Source: Coin360
Daily cryptocurrency price chart. Source: Coin360

Currently, Bitcoin price is chasing the 200-day moving average after falling below the intraday low of $ 8,509. The recovery from $ 8,509 is very encouraging as it shows that the support of $ 8,500 is held and the shorter time frame indicates that the MACD is trying to break out of the oversold zone.

Previously, the relative strength index (RSI) has rebounded from 23 – a low level only seen since December 20, 2019 when the indicator was showing 20.83, and the MACD line on the 4-hour time frame also curved up. , but there is still a distance from the signal line.

4-hour chart of BTC / USDT. Source: TradingView
4-hour chart of BTC / USDT. Source: TradingView

Traders also noticed that the MACD histogram bars had shortened their length and turned to pinkish as the volume of Bitcoin purchases increased.

Daily chart of BTC / USDT. Source: TradingView
Daily chart of BTC / USDT. Source: TradingView

Another positive thing is, earlier in the day, traders tried to regain the 200-day moving average, but at the time of writing, the Bitcoin price fell below this level again. It is important that the price finds support at 200-DMA but the VPVR indicator also sees that the 50-day moving average ($ 9,230) and the high volume button at $ 9,254 – $ 9,428 will push the price back as a resistance. .

This is not too surprising, since $ 9,500 is a strong resistance level that is hard to turn around into support on February 5.

On the 4-hour time frame, we can see a higher bottom pattern is forming, but the long upper wicks of each candle show that traders are taking profits instead of the Long position.

It seems that the current decline below 200-DMA is reflecting the traditional markets – having closed with a bad day.

In the current situation, trading volume will be the final deciding factor on whether Bitcoin price can sustain its efforts to reverse the trend.

Daily chart of BTC / USDT. Source: TradingView
Daily chart of BTC / USDT. Source: TradingView

On February 26, CoinTelegraph analyst Scott Melker did tweet The chart above and shows:

“Are people talking about this?”

If the reversed head and shoulders pattern Melker mentioned was a complete right shoulder, the price of Bitcoin could drop to as low as $ 7,400. Therefore, the expectation is that the bulls must keep the price above the 200-day moving average.

If the price breaks below 200-DMA and drops to the support of $ 8,500, traders can wait for a bounce at the Fib 61.8% retracement ($ 7.991). Failure to pop up in the golden pocket will increase the likelihood of completing a reversed head and shoulders pattern.

Readers can update BTC rates and more than 2,000+ cryptocurrencies in real time here.

Disclaimer: This article is an analysis by cryptocurrency analyst Horus Hughes – a frequent contributor to CoinTelegraph. Readers should only consult, not consider this as an investment advice, especially from Toiyeubitcoin, we will not be responsible for your investment.

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According to CoinTelegraph
Translated by ToiYeuBitcoin

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