The year isn’t off to a bad start for Bitcoin, but it’s not exactly off to a ‘bang’ start. The price is up almost 1% today. If we repeat last year we can expect much more, so we keep our hopes high. Let’s look at the graphs.
How is Bitcoin doing?
This time we do not use the weekly chart, but the 4-hour chart of BTC. Here each candle represents 4 hours. The image below shows two important price levels that influence the price. These are shown as green zones, and we’re going to start with the lower zone which is around a price of $37,500.
We see that Bitcoin encountered resistance there (left in the chart) for a while. Sellers saw their opportunity to take some of the profits they had made at the beginning of the year. However, buyers continued to buy higher and eventually pushed the price past this level. This resulted in a big reaction: Bitcoin rose to $45,000 in no time.
This is the location of the second green zone. If Bitcoin ever gets past this, we will see new highs. Until then, this level remains the biggest resistance for BTC. We would like to see Bitcoin rally below $45,000 as it did at $37,500. It made higher and higher lows there with equal highs, and this usually results in a break at the top. So it would be nice if this also works this time.
What can we expect?
However, we cannot completely assume this. There is one thing that can ruin this pattern, and that is a lower low. Bitcoin is currently making higher and higher declines, but if that changes, it is likely that the price could fall back for a while.
The levels that become important at that moment are the red line and the lower green zone. The price does not have to immediately turn into a bearish scenario (for the long term), but it would be better if BTC can hold the higher lows.
We must be careful that Bitcoin does not enter a downward trend. This would be when the price not only makes lower lows, but also lower highs. This usually results in a further decline for a longer period of time, and of course we do not want to see that scenario. It would therefore be better if the price continued in its current trend.
2024-01-01 13:49:23
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