Cryptocurrency investors find a smile when they see Bitcoin return to $41,000 again and exceed it at the time of writing these few lines. Since the end of January, this key level, which corresponds to the neck line of the shoulder-head-shoulder (ETE), has thwarted the multiple attempts to rebound. Will the latest be the right one or a simple copy-paste from previous weeks?
Even if at the start of the weekend, BTC is currently above $41,000, the worst is yet to come. Technical analysis is still light years away from a bearish reversal since its last ATH in November 2021 such that the game of chess is likely to continue for quite a while.
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Bitcoin still inside the Kumo but on track to cross the Tenkan
Bitcoin has been embedded inside the Kumo (cloud) for nine consecutive weeks. By dint of lagging in the neutral zone of the Ichimoku, the underlying trend remains uncertain with a predominantly bearish bias due to the ETE which seems to dampen the enthusiasm of investors. At the same time, the fact that the Chikou Span is also inside the cloud forces us to confirm the neutralization of the bullish cycle since 2019.
my belief, and that only engages me, leads me to believe that we shouldn’t expect to see a bull run again until BTC prices break free from the next resistances and move away higher from the Kumo. Going by the weekly chart, the next moves in any direction are leaning towards skepticism.
On the other hand, the crossing of the Tenkan, which needs to be confirmed over the next few weeks, would allow us to see a return of Bitcoin close to the resistance around $46,000 Firstly. If appetite comes with eating, why not rally resistance around $51,000-52,000 which itself is so critical. Because it is practically at the level of the Kijun. This positive technical signal, if it were to materialize, does not change my comments in the previous paragraph.
New foray over Kumo in daily units
In daily units, things seem to be brightening up slightly. First, Bitcoin prices are currently above Kumo with a precarious margin of safety. Second, they succeeded in successively crossing the Tenkan and the Kijun. Recently and simultaneously, the Chikou Span passes back inside the Kumo. The alignment of these three technical signals helps to see the King of Cryptos above the ETE neckline around $41,000.
That being said, it will take a lot more to break out through the top of the horizontal channel (orange rectangle) between support around $34,000-35,000 and resistance around $46,000. The latter has been revisited twice without success since the end of January, so this confirms the uncertainty of the current trend.
If it goes above $46,000, the Chikou Span would come back well above the Kumo. The sooner the better to consider a bounce towards resistance around $51,000-52,000. As I told you in the previous part, it could cause us problems when the time comes.
In summary, even if this week seems set to prove better than the previous ones, it is clear that nothing has changed on the evolution of Bitcoin prices since the beginning of the Russian-Ukrainian conflict. We might have thought that the last FED meeting would be a turning point – in the end it was not. The game of chess continues and its outcome will sooner or later leave traces.
We will maintain in the days / weeks to come our vigilance on the exit of the horizontal channel. From the top, the downtrend of BTC since its last ATH would be neutralized, but the position of certain Ichimoku curves in weekly units would not open the prospect of a new bull run. From below, in other words, the support around $30,000 would seriously approach in the event of a resurgence of the current risks on the financial markets.
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