Bitcoin Price Struggles to Leave $4k Consolidation After Upside Push

Bitcoin (BTC) has again retested the important $4,000 price ceiling on 19-20 March, but is unable to remain above this level on non-Tether exchanges.

Instead it has continued to range in the same consolidation pattern that began after the 16 March breakout. This consolidation appears to be a bull flag, between roughly $4,000 and $3,940.

However, the price is holding at or above the 55 hour EMA, which has been trending upward. Respecting this line (below, in pink), appears to be another squeeze within the $4,000 resistance level. Volume was rising on the 19th, but has dropped off again today (20 March).

btc20mar1.png(source: TradingView.com)

The support / resistance (S/R) zone in the low $3,900’s must be held in order to stay in this consolidation. Should it break, however, there is a strong knot of support at mid $3,800, as well as the Feb-March uptrend support (in green, below) to catch Bitcoin’s fall.

btc20mar2.png(source: TradingView.com)

In the long term, the area between $4,100-200 remains key. At this scale, Bitcoin is consolidating within an ascending triangle pattern, which is bullish. There is plenty of elbow room to manoeuvre, but this pattern could continue for months. Should BTC break out, it would quickly be in striking distance of the critical 200 day moving average. Getting and staying above the 200MA could change the long term trend of Bitcoin and end the bear market.

btc20mar3.png(source: TradingView.com)

On the very long term (weekly chart), Bitcoin is approaching a level of downtrend resistance. A failure to break this could be problematic. What’s more, it is hard to ignore the possibility that on a very long term, Bitcoin has formed a bear flag, suggesting the possibility of (hopefully) a final capitulation to end the 2018 bear market in style.

btc20mar4.png(source: TradingView.com)

Bitcoin's Volatility Index Drops to 15-Month Low, Hinting a Big Move Is Coming

Francisco Memoria

Bitcoin, the flagship cryptocurrency, has been trading within a tight range over the last few weeks, as it has been failing to surpass the $10,000 mark, while support at $9,000 kept it above that level.

CryptoCompare data shows that bitcoin’s price entered the range in May after recovering from a market sell-off that saw its price drop by nearly 50% in only 24 hours, on the so-called Crypto Black Thursday. Bitcoin has been trading within this range since.

This range has seen its 30-day volatility index drop to a 15-month low at 1.9%, a level that hasn’t been since March 2019 when the index dropped to a 1.25% low. The flagship cryptocurrency’s 30-day index hit 11.05% during the market crash, which occurred during a wider sell-off in equities markets.

bitcoin's volatility indexSource: Bitpremier

Notably, bitcoin’s price was trading close to the $4,000 mark back in March 2019, when its volatility was rather low. Over the next few months, BTC’s price and volatility both started rising. As the price of bitcoin hit a $13,000 high in July, its 30-day volatility index moved up to 6.94%.

bitcoin price march to august 2019.pngSource: CryptoCompare

 Some analysts are now expecting the price of the flagship cryptocurrency to make a significant move once again, but BTC may not see a bullish rally in the near future as well. Zooming out we see bitcoin’s 30-day volatility index also dropped below 1.5% in November 2018. The low volatility preceded a price drop from over $6,000 to a $3,200 low in December 2018.

bitcion october 2018 to december 2018.pngSource: CryptoCompare

After hitting the $3,200 low the price of bitcoin started recovering from the year-long bear market it endured in 2018. Back in October 2018 CryptoGlobe reported on BTC’s low 30-day volatility index, and back then prominent market analyst Willy Woo correctly argued BTC was still in a bear market.

Recently on Twitter, the analyst claimed BTC was “setting up for a bullish run until the COVID white swan killed the party,” before adding the model suggests “we are close to another bullish run.”

Featured image by Austin Distel on Unsplash.