Connect with us

Analysis

Bitcoin’s potential rally depends on its pullback; $9,075 or $9,600?

Published

on

Source: Unsplash

The prophecized golden cross is clearly taking its time to kickstart the rally. At press time, BTC was worth $9,670, slightly higher than last week’s close [$9598]. On the weekly time frame, Bitcoin’s rally hinges on how February ends. For now, the rally to $10,500 looks like the local top and a correction is underway.

The question is, ‘correction to what level?’

Weekly

Bitcoin's potential rally depends on its pullback, $9,075 or $9,600?

Source: BTC/USD on TradingView

On a weekly time frame, the price has a leeway to drop to $9,075; this has a higher chance of catching the price’s correction. Moreover, this could also be the level the price might rebound off before starting its rally. However, even a rally from this local bottom would cause major resistance at $10,300 and $10,500, both of which are prior weekly highs.

Further, the declining trendline extending from 2017’s highs connect the mid-2019 highs and the current high at $10,500. Hence, a confluence of all these levels will be a hindrance to the rally.

Contrary to all of the above, the price looks overly bullish considering the 21-weekly moving average.

Source: BTC/USD on TradingView

The Weekly RSI indicator showed a decline, similar to the price, indicating a bullish future for Bitcoin. However, as seen, RSI’s downtrend might face some small support. Therefore, the RSI’s descent to that support might take Bitcoin to the aforementioned level at $9,075. This could be the last pullback below $9,000, before the rally commences.

Daily

Bitcoin's potential rally depends on its pullback, $9,075 or $9,600?

Source: BTC/USD on TradingView

The daily chart provided an alternative view of Bitcoin’s future. As seen in the daily chart, the price level between $9,636 to $9,770 is a deciding level. For the price to rally higher or go lower, it needs to bounce or breach the said range.

For the Fibonacci level, that extends from $3,120 to $13,800; the next level for Bitcoin after breaching the $9,770 level is 11,577. However, if the price breaches $9,636 and closes below it, the next immediate yet lower level is $8,950.

Hence, the daily chart presents a whole set of opportunities, but over a much smaller time scale.

Conclusion

Albeit unlikely, considering both the weekly and the daily time frames, the higher level to watch out for is $10,500 and the lower level is $9,065. However, the daily time frame seems more chaotic and less likely. The weekly time frame presents a more achievable scenario.

Where to Invest?

Subscribe to our newsletter

Akash is a full-time cryptocurrency writer and an analyst at AMBCrypto. He is an engineering graduate with an avid interest in finance and economics. Attracted to the chaos of trading, Akash has invested in BTC, ETH and XRP for educational purposes.

Click to comment

Leave a Reply

Your email address will not be published. Required fields are marked *