The recent regulatory attacks and the more hawkish repricing for the Fed interest rates path weighed a lot on the bitcoin price, but the cryptocurrency showed a surprising resilience and rallied back strongly as soon as the hawkish expectations waned, and the dust settled on the regulatory front. All else being equal, the recent strong bounce from the key support level may suggest that the pullback for bitcoin has ended and we are about to see new higher highs, unless we get again another hawkish repricing due to strong economic data or even a recession.
Bitcoin Technical Analysis – Daily Timeframe
On the daily chart, we can see that after pulling back to the key 25231 support where we had also the confluence from the 50% Fibonacci retracement level, bitcoin started a slow and steady rise into a key trendline that defined the descending triangle pattern. Once the price broke out, we saw a quick and strong rally to the 31K high where the price stalled and started to consolidate. Nothing seems able to stop bitcoin at the moment, but the sellers are always on the lookout for more Fed rate hikes or a recession.
Bitcoin Technical Analysis – 4 hour Timeframe
On the 4 hour chart, we can see that the price is struggling a bit to break above the 31K resistance. A good support level where the price can pull back to is the upward trendline where we can also find confluence with the 38.2% Fibonacci retracement level. That’s where we should expect the buyers to step in more strongly with a defined risk below the trendline and target a new high. The sellers, on the other hand, will want to see the price breaking lower to pile in and extend the eventual selloff into the 27000 level.
Bitcoin Technical Analysis – 1 hour Timeframe
On the 1 hour chart, we can see more closely the current rangebound price action and also the support level at 29500. We can see that the last leg higher into the 31K resistance diverged with the MACD. This is generally a sign of weakening momentum often followed by pullbacks or reversals. In this case, it should first lead to a pullback into the above mentioned 29500 support, which is the recent swing low level. That’s where we should see what will happen next for bitcoin: a strong bounce should take us to new highs, while a clear breakout should lead to a selloff to the 27000 level.
This week is pretty empty on the data front with only the US Jobless Claims tomorrow and the US PCE on Friday. However, we will get comments from many central bank members, including Fed Chair Powell today.
