Bitcoin’s current price is a swing trader’s paradise with clear support and resistance zones. It is respecting Fibonacci levels on weekly and daily time frames like clockwork. Using weekly and daily charts with Simple Moving Averages, Ichimoku Kinko Hyo, Fibonacci Retracement Tool, and RSI indicator, interesting things can be observed.
Bitcoin Price Analysis:
A quick glance through the weekly time frame of BTC/USD chart, the price seems to respect 61.8% Fib level with 49 days SMA (Simple Moving Average; solid green line) at $7272 and $7315 respectively. RSI is at 44.63 and can expect some push from buyers to break it out from the falling wedge and BTC price testing the resistance of 50% Fib level, which corresponds to $8531 and 9 days SMA.
Laying Ichimoku Kinko Hyo on 1 Week Time Frame, following things can be concluded:
- Prices respected Kumo levels and bounced back from Senkou Span A.
- Bearish TK cross (Tenkan Sen and Kijun Sen cross) in Bullish area (above the cloud), prices under the Tenkan Sen, thus prices may return to Tenkan Sen level, i.e., $8533 which is also 50% Fib level.
- Chikou Span (solid orange line) bounced back from 61.8% Fib level, and it is currently inside Kumo.
Analyzing the 1 Day Time Frame of BTC price chart with the same Ichimoku Kinko Hyo:
- As prices went down too far under the Tenkan Sen (solid blue line) and briefly touching $6500, it bounced back and did a successful S/R flip of Tenkan Sen and currently trading above it.
- Next Resistance is $8063 represented by Kijun Sen (solid red line) and also previous daily support zone.
- Bitcoin prices bounced back strongly, and the next resistances or TP (Take Profit) area are $8063 (Kijun Sen), weekly 50% Fib level at $8544, $8800 (Kumo resistance) and $9741 (weekly 38.2% fib level and previous weekly support) respectively.
RSI bounced back sharply after hitting a low of 21.53 (oversold area) and currently approaching resistance shown by the red dotted straight line in the below-given graph. RSI may stay in the parallel channel marked by red and orange dotted straight lines, which means BTC Price may go sideways between Tenkan Sen and Kijun Sen, i.e., $7374 and $8063 for some time before retesting $8544.
Bitcoin prices successfully did S/R flip of 9 days SMA and currently approaching next daily resistance (white dotted straight line), which also coincides with 21 days SMA and 38.2% daily Fib level. Since the BTC prices seem to respect the Fib level, and thus, it can be used for TP (Take Profit) area for swing trades. 50% Fib level almost coincides with 49 days SMA, which is $8544 and $8411 respectively; it is a good TP area from the current price of $7637 (current price of Bitcoin as of writing this article).
Retail traders are fearful of current BTC prices while smart investors are positioning their longs accordingly. One can profit from the current situation by strictly following the above-mentioned TP (Take Profit) areas with some risk management.