BTC Analysis
BTC is ready for potential growth, but it must overcome several obstacles first.
Overview
BTC appears to have completed its major correction from recent highs, bouncing off a strong support level at 53.4k, resulting in a 25% price surge. The market is for sure primed for continued upward momentum, driven by several bullish catalysts:
- Donald Trump, who is now considered pro-crypto, has a strong chance of becoming the next POTUS
- Rumors about the creation of a Bitcoin national strategic reserve in the US.
- ETFs are consequently reducing available supply.
- Increasing integration of BTC by TradFi institutions
- More flexible and open regulations towards crypto.
- Anticipated cut in interest rates, seen as a matter of 'when' rather than 'if.'
- Increasing global liquidity
-> Inevitably, there are reasons to believe that BTC is gaining in importance growing potential use cases in the near future
However, there are also bearish factors to consider:
- Uncertainty in the US political landscape.
- Kamala Harris, opposing Trump, is known for her anti-crypto stance.
- Potential sell-off from Mt. Gox creditors.
- Perma-bears are still present
-> Market uncertainty may lead to volatility as investors reassess or derisk their positions. Despite this, the bullish factors seem to outweigh the bearish ones, indicating a likely positive outlook
Sentiment
Market sentiment shifted quickly from strong bullishness after two weeks of gains to fear following just two red candles. Quick change from euphoria to fear is typical but could be beneficial, as it could of course, as often, indicate a shakeout of weak hands.
Charts
Won't go deep into TA and technicals on all timeframes, but here's the essential
Monthly & Weekly
-> BTC bounced perfectly on the upper band
-> BTC is back above weekly bands but needs to form a Higher High
-> Price remains below the 2021 ATH and hasn't been retested
-> Weekly consolidation could be forming a bullish flag
Daily
-> Recent move up produced a HH and a potential Higher Low is yet to come
-> Noticeable volume divergence can be observed on the way up
-> 50/100 EMA crossed bullish
-> Daily bands flipped green (red; green; red; green sequence)
-> Gaps left below at 62.3k and 60.6k (including a CME gap)
-> We can also say that price has been trading in a sideways range for 147 days now
4H
-> Price broke down from its previous lower timeframe range
-> Rejected from both POC and VAL; bands turned red and are now acting as resistance
-> 50/100/200 EMAs are bullish, with price holding above the 50 EMA
-> 65.3k - 65.7k acting as strong support and previous breakout level
Liq Maps
As you can see below, there’s a lot of fuel that can be easily caught below
Potential paths based on the 4H chart
Green Path
Bullish factors create substantial demand, absorbing selling pressure. Consolidation above the 50 EMA may establish a new range low, allowing further consolidation. Possible wick downs could clear buy stops.
Red Path
Price returns to the OB to fill the gap entirely, touching the 100 EMA and retesting daily bands for the expected higher timeframe Higher Low. A strong reaction here could reclaim current support, removing most of the leveraged and still allowing for further consolidation
Conclusion
Zooming out, no clear move is defined until a breakout above the ATH is confirmed. Zooming in, the price needs to cool off after a two-week rally, the best way to do it is to consolidate. A further dip below mentioned levels seems unlikely due to the strong bullish fundamentals and uncertainty being only temporary. If the red path is followed, I genuinely believe it could mark the bottom for the coming weeks or months.