The recent bullish momentum in Bitcoin has led to comments in the markets that the cryptocurrency has entered the first phase of the bull season. Some commentators, on the other hand, say that there are points that need confirmation yet, and say that it is useful to remain cautious. Let's take a look at what technical stages Bitcoin is in and remember once again the main problems in front of it.
Bitcoin corrected its January surge in the first half of February. After the correction to the $21,000 band, it was replaced by a rapid recovery, but the sellers have not yet allowed Bitcoin to settle at the $25,000 level.
According to the latest situation, this week, BTC seems to have found support above $ 23,600, which was used as resistance in January. Let's first examine the long-term outlook for Bitcoin, which started 2023 with a recovery after the long-term decline in 2022.
We can better understand the current path when we look at Bitcoin from a broader perspective on the weekly chart. Although Bitcoin drew a fluctuating chart with many problems in and out of the sector in the period between 2019 - 2021, it has caught a clear upward trend, especially since the last quarter of 2020.
Bitcoin, which rose to $ 69,000 in this process, which coincided with the bull season, entered the correction phase that will last for a year, with the Fed mentioning that it will adopt a tightening monetary policy in November 2021.
From a technical point of view, the correction phase seems to have ended in the region that coincides with the Fib 0.786 value according to the long-term uptrend. In addition, BTC has accumulated by moving sideways in this region for about 1.5 months, confirming that this region is an important support line.
The upward movement that started when the year 2023 was entered led to comments that the $ 16,000 levels for BTC are historical bottom regions and that the crypto money is on the rise again.
Although there are some signals of Bitcoin's trend reversal on the weekly chart, there are also points that cannot be confirmed yet. For example, the 8-week EMA rises above the 21-week EMA for the first time since the reversal in December 2021 and can be interpreted as a positive outlook. In addition, the 89-week EMA value at $27,600 this week is followed as a long-term average, while the BTC price is still moving below this value.
This can be interpreted as BTC has not yet stepped into the positive zone. Because, after BTC crossed above the 89-week EMA in May 2020, it formed a ground in this region and started a long-term uptrend with net weekly closes above the short and medium-term EMA values.
As a result, from a long-term perspective, it may be premature to talk about the general trend returning unless Bitcoin hits a net weekly close above $27,600 this week.
On the other hand, on the weekly view, the Stochastic RSI is currently in the overbought territory. When the past positions of the indicator are analyzed, it can be seen that these regions form local peaks, followed by a correction. However, this situation differs in the bull season when high volume buying transactions occur.
Accordingly, it has become extremely important to stay above the support zone stretching up to $21,000 to maintain the trend in a possible pullback that can be seen next week. This will also be followed as an important step in testing how robust Bitcoin's uptrend is.
When we examine the last two-month trend on the daily chart, it can be mentioned that BTC has taken an important step by staying above the Fib 0.144 value at the $ 22,800 level according to the 2022 downtrend. On the daily chart, the 3-month EMA value, with its position in the $21,000 band, once again tests that this region is the main support line for the trend to be maintained.
At the same time, Fib 0.236, which is an important confirmation level for the start of the uptrend, coincides with the $ 27,550 level, forming a point in line with the 89-week EMA value.
In summary, in order to confirm that cryptocurrencies have entered the rising trend, which can be seen as a bull season, technically, a weekly close above $ 27,600 and forming a ground above this region stands as the first condition. In the lower zone, on a possible correction, the $22,800 initial support line and then staying above the $21,000 zone will be followed as important levels to avoid losing current gains.
The pace of bitcoin and cryptocurrencies has been cut this week along with the FOMC minutes. The Fed's hawkish views that it will continue its tightening monetary policy, and the increasing pressures on the crypto market, especially in the US, stand as the biggest obstacles in the recovery phase.
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