Bitcoin price has been ranging between $26,000 and $31,000 since mid-March; the volatility seems to be dropping and except for trading opportunities in smaller time-frames, we are yet to have a market break in any direction.
As seen above, there has been a major uptrend since early January. Still, the bullish momentum seemed to have lost steam and the bears do not seem to have gathered enough momentum to reverse the trend, hence causing slow movement and low volatility in the market.
While the ranging pattern on the daily chart is between the two blue lines at $26,184 and at $28,486, there is also a minor ranging pattern in a 4-hourly time frame after a minor and gentle downtrend as shown below:
The minor downtrend marked with the white trendline extends from $31,140 to $27,722 levels while the ranging zone (acting as a demand zone) which is represented by the blue rectangular zone is between $26,169 to $27,096. This same blue zone is represented in the hourly time frame below:
It would seem the market is having a lot of respect for this zone and has been bouncing around in it, save for the small breakout, which hit the trendline resistance and jumped right back into the zone. This is where it gets really technical. Now, the price has two zones to break (i.e the demand zone and the trendline resistance) to signal a solid bullish momentum capable of reversing the minor downtrend on the 4-hourly chart and in addition, breaking the daily swing high at $31,170 to signal a continuation of the major uptrend on the daily chart.
Essentially, while there seems to be a bullish bias, we can’t hurriedly act as Bitcoin’s “big move” is due in July according to Cointelegraph. This bullish bias is further agreed on by QCP Capital which believes that the Bitcoin consolidation “played out well” and predicts a change in action by June’s end. QCP believes this is thanks to the United States debt ceiling “sideshow” vanishing, leaving Bitcoin closely mimicking its consolidation and breakout phase from 2020. And as we know, the market is filled with patterns so we can hardly go wrong in following patterns.
Cointelegraph quoted QCP thus: “With the passage of the Debt ceiling bill through the House and Senate that extends the ceiling until Jan 2025, we can now all move on and not have to worry about any political sideshow again until next year’s US Presidential elections”. In QCP’s newsletter series, Zombieland! The Sequel, wrote, “There are many parallels between today and 2020 for Bitcoin.
In March 2020 we were on the verge of a massive price breakdown below 5k when the Fed unleashed the liquidity tap, resulting in an exponential price increase as we approached the halving cycle the following year.
Similarly, in March 2023, we were about to break below 20k on BTC as a result of the banking crisis risk-off, when the Fed again unleashed the liquidity tap to drive us back above 30k, as we head into the next halving cycle next year.” While the prices may be different, the patterns remain the same in 2023 as they are mimicking the moves in March 2020 COVID-19 crash.
Featured image: Shutterstock
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Dominic Jubemi is primarily into legal practice. However, he has taken interest in building and grooming fundamental skills in FX and Crypto trading, audio engineering and in the nearest future, fiction writing.
