Bitcoin (BTC) has reached a very important position in the past week, that being the potential limit of its MTF market structure. It seems likely that a move above or below this limit will come soon, deciding where the leading crypto will head in the next months. In short, it merits our attention especially now.
Starting on a clean 3-day chart, we clearly see Bitcoin hitting against an important trendline drawn from the 2019 high.
A break of this level would naturally lead to the possibility of a return to the 2019 high of $14k.
Moving to another, tighter 3-day chart, we also see that Bitcoin is pushing exactly against the .786 Fibonacci level. This area of the Fibonacci retracement scale is important, as it is often the last line of defense for a market structure.
This means that if Bitcoin breaks $9,100 on strength, we are likely to see this market structure breached. The red band here is the same as the downtrending line on the previous chart, which would quickly dissolve on a break of $9,100.
Moving to the daily, we see Bitcoin trending within significant 2019 resistance. The histogram looks healthy, and may be cautiously signaling that it wants to resume its bullish expansion; but it is not perfectly clear at time of writing.
It has remained overbought on the RSI, but here we see a danger: if the RSI goes higher on another leg without putting in a new price high above $10k, we may see a hidden bearish divergence show up here, implying a continuation in the overall bearish trend from the past months.
Finally, on the 4-hour, we see that the RSI here has had plenty of time to cool off. We look well set up for a potential leg up, with price remaining strong above the EMAs. The histogram has also had ample time to reset and looks to be poised to attempt a positive cross.
The decision here is an important one, dealing with an extremely important trendline. This is one of those times to be watching Bitcoin closely, as there is likely to be a strong trading opportunity either to the upside or downside.
The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.
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