When will this bear market end? That’s the most popular question these days. Yesterday had started with a little hope for the bulls, however, this hope had quickly disappeared as Bitcoin failed to break up the $4050 resistance area.
As expected, the failure had sent Bitcoin to re-test the current yearly low around $3500. As of now, the support there holds; what gives a little hope for another positive correction.
The answer to the above question is simple as that: The bear market will end soon as the buyers will come back to buy Bitcoin. We do identify a first positive sign regarding this: By looking at the daily chart, and after a series of substantial red candles (of sellers’ volume), there are some nice green ones of buyers.
To my opinion, we haven’t seen the bottom yet (technically, the bottom could be around $3000, as predicted before Bitcoin broke the $6K support). But as long as the buyers’ volume will increase, the chances to see that desired bottom are rising as well.
Looking at the 1-day chart & 4-hour chart
- The 4-hour chart emphasizes the lower lows Bitcoin is forming, which is a bearish formation. This is shown on the following chart and colored in a light blue descending line. The first bullish sign I will be looking to see is breaking up that line, which was starting to form around the $5K area.
- From the bears’ side: The next support area lies where Bitcoin is now – the $3700 mark. Below, lies the $3500 support area (which is the 2018 all-time low). Failing to hold that level will likely to send Bitcoin to the next support levels: $3300, $3200 and $3000.
- From the bulls’ side: The next major resistance is the descending trend-line – this should be around $3850 – $3900. Above that line, is the $4050 resistance area (prior high) and $4360.
- The RSI indicator of the 4-hours chart continues to hold above the important 30 mark, while the RSI indicator of the daily chart is forming an ascending trend-line.
- BitFinex’s open short positions have increased to 33.5K, close to the monthly high at 35.5K.
BTC/USD BitStamp 4-Hour chart
BTC/USD BitStamp 1-Day chart
Cryptocurrency charts by TradingView. Technical analysis tools by Coinigy.
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