Crypto Analysis #1
BTC/USDT has broken a major uptrendline to the downside
Hey there, what's up!! Trader Saan is here. Hope you are all doing very well. Today I am going to write about Bitcoin's current market structure and possible trading bias.
I am a swing trader, that means I hold my position few days and trade at the timeframe of H4, H1 and occasionally at M30. And I do market analysis based on both fundamental and technical confluences which give me more confidence in opening a position. I use tradingview for the chart analysis and take trade on MT4 ( for Forex) and Binance ( for Crypto).
Firstly, I will cover the Fundamental parts of BTC/USDT and then will give an insight of the Technical analysis.
Fundament Outlook: Slight Bearish
USD
In the last meeting of the Fed, the monetary policy maker has uttered to rate hike of a 300bps. And that has caused many traders and investors to appreciate the USD.
The USD is in uptrend from June, 2021, that is when the Joe Biden policy has been published. Till now the uptrend is intact.
The invasion of Russia and the COVID pandemic in the EU and south asia are another causes of appreciating the US dollar as the USD is one kind of safe asset.
To conclude, I am bullish on USD both long term and short term.
BTC
Luna Foundation guard bought 1B dollar BTC as a reserve asset of 3B orders few days ago which had made a breakout of a major resistance of BTC/USDT. But when the Fed news popped up in the market, BTC's bullishness was fadded away. As a result price has moved downward and broken a major uptrend line. And possibly, BTCUSDT has got into the range bounded situtaion again.
After the Joe Biden first sanction to Russia, Russia has been banned from conducting their business deals with other major countries and using other's currency like JPY, EUR,GBP etc. For this, many Russian commercials and non-commercials have been using Crypto currencies to conduct deals with other countries counterparts, which has appreciated BTC as it is the most major Crypto. But after some days, Russia has announced that any business deal with them should have to be conducted using their currency Russian Ruble. After that, BTC has started deppreciating.
To conlcude, I am slightly bearish on BTC until further news come up.
Technical Analysis
- Price was in a uptrend supporting by a uptrend-line. But price has broken that uptrend - line with a heavy sell pressure at 11th april,2022. It indicates that sellers has come into the market with a heavy quantity sell-off.
BTC/USDT, H4, price has broken a major uptrend-line
Image source: tradingview, prepared by me
- Now that a breakout happen to the downside, we are going to wait for the proper pullback or retracement or profit taking move to the upside. The question arises that how much pullback move is likely to happen!! Well, the tool Fibonacci Retracements is used to take a gauge of the pullback move. The level of 38% fib retracements is important here as it has also a resistance confluence. So my perception is that price is likely to come at this level, and if the price shows some rejection in this level then it will probably go down to the support zone of 30k.
BTC/USDT, H4, wait for the proper retracements, fib 38% level is important
Image source: tradingview, prepared by me
- I don't use much indicators as I'm a price action trader. Here I have used 50 & 200 MA just to increase my odds to my sell bias. In the H1 of BTCUSDT chart below, 50 & 200 MA are aligned downwardly which indicates that sellers are in control for now. And look at the chart, the fib 38% retracements level and the resistance zone are just on the 200MA, this makes this level more significant for both short and long term traders.
*BTC/USDT, H1, 50 & 200 MA are aligned dowanwardly *
Image source: tradingview, prepared by me
- The Conclusion:
Fundamentally, I am bearish on BTC and bullish on USD which makes a Bearish bias on the pair BTCUSDT.
Technically, I have resistance zone, MA confluences, Fib psychological level(38%), Broken uptrendline - breakout pullback scenario.
What else I need!! Just need to wait for the perfect time to jump in.
BTCUSDT, H4, price could go down as it is shown here
Image source: tradingview, prepared by me
Note: Be very careful when you consider this level to take trade. If price shows no rejection in the resistance zone and breakout happens, be mindful to change my bearish bias
I always take trade when my both fundamental and technical analysis say same thing otherwise I choose to wait for the right time
Disclaimer: This post is not a trading mantra or get rich quick method, it is made only for educational purpose. I truely want to help others who want to learn Forex and Crypto trading and investing. Trading in the financial markerts involvs a lots of risk.
Thank you so much if you make it to the end.
Hope it helps
Happy Trade 😊