What does Bitcoin look like in the big picture?
Bitcoin (BTC) closed the day negative yesterday as well. Thus, a new short-term trend was formed for BTC/USDT, which closed the day at a lower value for 3 consecutive days.
Bitcoin (BTC), which started the day with a seller, seems to have broken an important symmetrical triangle formation to the downside. This may cause an increase in losses in BTC.
Bitcoin Daily Chart
Bitcoin has returned to the band movement formed at roughly $40,000 – $33,000 with the last 3-day losses. It seems that buyers have weakened this week, especially for Bitcoin, which cannot be permanent in the $ 40,000 band. Let's try to evaluate the general situation by looking at the weekly chart and the Bitcoin chart from a distance.
Bitcoin Weekly Chart
Exactly one month ago, the Bitcoin market entered a rebound after hitting $30,000 lows the week of May 17. How can we see this on the weekly chart? Weekly closes were positive, albeit low, until this week. In the Bitcoin market, which has been dominated by the negative trend this week, there is a weekly decline of 3.5 percent as of now. So, is the size of this decline worrying?
Now this week, we are seeing a correction of the remaining 3-week recovery movement. The correction process started with the loss of the $38,656 support (Fib 0.236) measured from the bottom and top. Now there is $37,000 support (Fib 0.382) ahead. This support is very important in order not to increase the losses.
If Bitcoin closes the week below $37,000, the possibility of easing up to $34,300 gains strength. While the continuation of this movement may cause testing of 32,400 – 30,000 supports, the bearish setup may continue up to the $23,000 – $25,000 band. That's why defending $37,000 is extremely important.
Staying above $38,700 this week could sustain the uptrend. A one-week close above this price may be perceived positively by the market as this level means staying above the main uptrend (green).
It is very difficult to talk about a recovery without Bitcoin finding a place in the $ 39,000 band above 38,700. Also, the 8-week EMA has slipped below the 21-week EMA, which is a strong signal that losses may increase. Also, the 50 MA – 200 MA reversal cross (they call the death cross), which is followed by the market, is heading towards realization.
Some traders interpret this reversal as an entry into a bear market.
In summary, how the market will react to this week's close is crucial as Bitcoin is in a correction this week. Staying below $37,000 could increase losses. Reaching $39,000 may open the doors of a new trend. In addition, market news can distort the entire technical outlook. It is also useful to interpret the news carefully.
Disclaimer: The information in the content is not an investment advice. Author is not responsible for your profit or loss. Every investment involves risks and requires knowledge.
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