Bitcoin (BTC) is a deflationary currency that is basically supposed to rise in price. In the long run, this has always happened so far. The picture shows Bitcoin coins in front of a smartphone price graph.
Higher faster further. That is probably the current motto for the Bitcoin course. One all time high chases the next. A correction is not in sight and yet there are always signs that urge caution. In the following analysis, important price levels are filtered out on a weekly, daily and 4-hour basis.
All good things come in threes for the Bitcoin course
It has now been three weeks since the 2017 All Time High was toppled. In our report of December 14th , 2020 we already pointed out that an enormously strong movement was imminent. The current end of this move is now at $ 34,810 on Coinbase. Which does not mean that this must have been the end of the Bitcoin course. However, should a correction occur, the first longer-term support zone would be between $ 19,300 and $ 19,900.
This tremendous movement of the past three weeks has been aided by crypto-external capital inflows and coin shifts towards Bitcoin. Whether this will be sustainable, however, we can only guess, let alone foresee.
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Also in the Daily an expensive Bitcoin course
Due to the steady increase, the Bitcoin price does not recover and is under constant stress. The Relative Strength Index (RSI), which shows whether a market is expensive or cheap, not only sounds the alarm in the weekly. In the Daily, the RSI is now back above 90, which is now calling for a correction.
But every slight drop in price is bought up again immediately and the market never has the chance to recover and rest a little. At the moment, other coins offer much better entry opportunities for a medium-term long position.
A correction of the Bitcoin price could come back to the level between the two daily key levels. This zone extends from $ 22,800 to $ 23,850. As the next support below, we turn our gaze to the zone from the weekly chart.
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Good entry in a smaller time frame
In our last report we drew attention to the still bullish market structure. This signals to a trader that they are looking for long entries. Within the last week, there were two perfect opportunities to trade the Bitcoin price on the long side.
With the break of the 4-hour key level and the subsequent confirmation of it, you couldn’t go wrong with long trades.
Trades against the trend are riskier and work less in percentage terms than trades with the trend. It is not for nothing that it is called “The trend is your friend!”. If the Bitcoin price falls below the mark of 32,225 dollars at the end of the candle, one should keep an eye on the next support zone at 28,800 dollars and 29,360 dollars.