Bitcoin: USD/BTC (BTC=X) has recovered 100% since its massive drop last month

Bitcoin: USD/BTC (BTC=X) has recovered 100% since its massive drop last month

Bitcoin (BTC) diving to a cliff in March and collapsing to prices not seen since a year ago is now a distant memory. The top crypto didn’t take long to recover at more comfortable levels, which, as of the time of writing, is $7,000. When it extended its drop to $3,858 in March, it was able to close 46% higher from that low on the very same day.

The quick comeback by BTC is a remarkable feat for the crypto and the rest of the market since the coronavirus was thought to be a black swan event that could erase the entire industry from the financial spectrum. But the 100% surge in 26 days is perhaps Bitcoin’s way of saying that it is here to stay. 

Cointelegraph named several factors why a rally took place. The first one was caused by the spot market that led the buying after the drop. The decline in open interest in futures exchanges and the increase in buy volume in the spot market created a shift in the market that propelled bulls.

“Cascading liquidations were most prominent on BitMEX, which offers highly leveraged products. Amidst the selloff, a Bitcoin on BitMEX was trading well below that of other exchanges. It wasn’t until BitMEX went down for maintenance at peak volatility (citing a DDoS attack) that the cascading liquidations were paused, and the price promptly rebounded. When the dust settled, Bitcoin had briefly spiked below $4000 and was trading around the mid $5000s,” Coinbase explained.

What this implies is that Bitcoin shouldn’t have dropped after all. On Coinbase’s platform, users buying Bitcoin at the initial fall only added to the cascade of liquidations, which furthered BTC’s decline.

And the last factor highlighted was the significance of the $5,800 support level that Bitcoin quickly floated to after grazing below $4,000.

The halving, which will reduce block rewards for miners by half, is set to take place in May, and plenty of BTC believers think that this supply reduction protocol will prop up prices. The past two halvings have effectively lifted the king of cryptos and stabilized it beyond each pre-halving price range.

Bitcoin’s demonstration that it can instantly pull in buyers to help it shake off a multi-market meltdown may be a shred of direct evidence that enough demand is there to satisfy a post-halving price rally.

Technical Indicators

Overall, the bias in prices is: Downwards.

The projected upper bound is: 8,624.91.

The projected lower bound is: 5,925.10.

The projected closing price is: 7,275.01.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 18 white candles and 32 black candles for a net of 14 black candles.

A doji star occurred (where a doji gaps above or below the previous candle). This often signals a reversal with confirmation occurring on the next bar.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 73.7250. This is not an overbought or oversold reading. The last signal was a buy 27 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 56.50. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 21 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 120.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 6 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 19 period(s) ago.

Rex Takasugi – TD Profile

FOREX BTC= closed up 4.390 at 7,321.000. Volume was 50% below average (consolidating)(neutral) and Bollinger Bands were 38% narrower than normal.

Open     High      Low     Close     Volume___
7,324.7507,402.2507,236.0507,321.000 199,444
Technical Outlook 
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 6,884.63 7,401.38 8,087.03
Volatility: 55 133 83
Volume: 1,023,024 571,914 225,300

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX BTC= is currently 9.5% below its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume into BTC= (mildly bullish). Our trend forecasting oscillators are currently bullish on BTC= and have had this outlook for the last 7 periods.

#Bitcoin#bitcoin forecast#bitcoin news#bitcoin technical analysis#BTC#btc news#investing#shayne heffernan#trading#USD/BTC