Bitcoin technical analysis: We wait for the pullback and buy the fall

Avatar James Lochner 2 years ago

Bitcoin has registered an extraordinary drop after having reached $25,000 a few days ago. In our technical analysis of Bitcoin, we explain the levels to watch, because we are in an excellent opportunity to buy in the long term.

Before it is important to explain that the crash that has occurred is due to the fact that we are at a very commercial level, and the bulls have not been able to push prices above the resistance that is located at USD 24.8K.

This only warns us that the bears are taking control right now, and in fact, in a matter of hours already the BTC price has plummeted more than 8.50% as we can see in CoinMarketCap. Although it is trading at USD 21K, the selling pressure may cause us to look for new lows that have not been seen before. The $18K is just one of the psychological supports, but the critical level would be around the $16K.

Fundamentals: The FED surprises with a request to Wall Street that includes cryptos

The recent crash in BTC has been quite worrying for many investors, however, evaluating other aspects we can see that the FED recently talked about cryptocurrencies. He mentioned that it could be an investment opportunity for the global financial system, banks, institutions, among others.

Bitcoin could benefit greatly from a decision made by the FED, but not only BTC, also ETH and the rest of the cryptos.

The Federal Reserve even called for better regulatory systems to be established on Wall Street to be able to work with digital assets as the market prepares for institutional investments. Since, they represent an opportunity with a lot of potential, according to the release that they shared several days ago.

On the daily charts of BTC you need to pay attention

In the technical analysis of Bitcoin we see a pullback that was further boosted by the downward crossing of Japanese candlesticks with the 2000 EMA.

In addition, BTC was in an ascending channel and there was an important order block around $22K. The fact that the sales have pushed the price below such levels only indicates to us that the downtrend will continue in the medium term.

The fixed range volume profile suggests that the $21K and $20K are a high trading volume level.

BTC breaks lower in search of levels below $21,000
BTC breaks lower in search of levels below $21,000. Source: TradingView.

The bulls will try to protect the aforementioned levels (21K and 20K). However, considering the liquidity levels in the market, it is likely that sell orders will continue to be executed. So, let’s keep an eye on the current price, as it could push us up to $18K in the short term if we break the support where we are.

The RSI gives oversold readings, being located at 11 points and with a strong bearish inclination. The MACD in the same way; its histogram reflects the beginning of sales, and the moving averages remain with a bearish orientation.

We are at the beginning of a new bearish cycle that could place us at interesting levels to make purchases thinking about the long term. While witnessing the pullback, let’s take advantage of the dips to accumulate more BTC.

The information in this content should be taken for informational purposes only, not intending under any point of view to urge the purchase / sale of financial assets.

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