- Significant long squeeze on Bitfinex and BitMEX
- Bitcoin has been rejected 3 times from the daily 26-period EMA
- The long-term remains positive in favor of the bulls
|⠀Key BTC resistance levels:||$9,188, $9,200, $9,131.85, $8,956.23|
|Key BTC support levels:||$8,660, $8,651, $8,411, $8,238|
*Price at the time of writing
Bitcoin had been in a decent 4-hour uptrend for the past few days. The digital asset managed to see enough continuation after the initial bounce but started to slow down around the $9,200 area.
Bitcoin was stuck between $9,000 and $9,200 for the last two days, trading sideways without much action.
BTC price analysis
What has been going on?
On the hourly chart, a pretty clear equilibrium pattern was formed. Initially, the bulls managed to break above the high of $9,143 until $9,188 where the price of Bitcoin was rejected significantly and dropped down to $9,020 within 5 minutes.
Bitcoin then dropped to $8,859 within the next 20 minutes creating a significant long squeeze on both Bitfinex and BitMEX. According to BXRekt, around $19 million worth of Bitcoin was liquidated on BitMEX and $1.5 million on Bitfinex. Of course, the rest of the market has followed suit.
After the initial drop, Bitcoin traded sideways for several hours before the next leg down to $8,710 and it’s currently trading sideways again at $8,743.
In the long-term, Bitcoin’s sentiment continues to be bullish as most analysts are looking at the upcoming Bitcoin halving as a very positive indicator.
If you’re thinking that #bitcoin will just go up non-stop because of the halving, let history be your guide.
Be prepared for anything. pic.twitter.com/OPgQlThR1R
— Jacob Canfield (@JacobCanfield) March 7, 2020
However, history has shown that Bitcoin doesn’t necessarily turn bullish before the halving, in fact, it usually sees a pretty significant extended drop and then turns bullish.
Bitcoin price short-term prediction: Bearish
After the sudden crash, the bears have taken control again over the short term. The hourly chart isn’t giving us a lot of clues but the 4-hour chart is now in a clear downtrend again. The bulls still have a slight chance of short-term recovery as the daily chart can still become an uptrend if they manage to set a higher low compared to $8,411 and then break the high of $9,188.
The bulls are now patiently waiting for the 4-hour chart RSI to get close to the oversold area and see a bounce afterward. The bulls are also holding an important support level at around $8,651. If they are able to hold this level, the bounce could play out without the RSI getting totally overextended.
Where is the resistance towards the upside?
On a positive note, because Bitcoin drops have been so sudden, the bears haven’t managed to set a lot of resistance on the way down. The bulls are currently looking at $9,188 as the nearest resistance but also the $8,900 area where both 4-hour EMAs currently are.
On the daily chart, there is also not a lot of resistance until $10,000 which means the bulls can definitely still come back.
What are the technical indicators showing?
This recent sudden drop doesn’t really affect Bitcoin’s long term. The daily RSI is currently at 41 points and the MACD is signaling to sell. The Momentum oscillator is actually positive in the short-term.
Pretty much all short-term moving averages are signaling a strong buy but the long-term ones are really bullish even in the short-term.
Previous BTC analysis
At CoinCodex, we regularly publish price analysis articles focused on the top cryptocurrencies. Here’s 3 of our most recent articles about the price of Bitcoin: