Bitcoin Starts to Correct as Market Takes A Breath, Golden Cross Looms— Price Analysis

  • LTF (Low timeframe) trend: Extreme chop, no trend
  • MTF trend: Uptrend is very extended now
  • HTF trend: 2020 looks excellent

Bitcoin (BTC) is correcting on the LTF charts, as is the wider crypto market. But Bitcoin is still technically in a MTF uptrend, and is basically ready for a reversal to the downside. We also await a so-called ‘Golden Cross’ on the daily timeframe, which often signals a bullish market, speaking well for the HTF picture.

We start on the daily, and there is a lot going on. The rejection at the local top, at around $10,500, seems to be holding, and we could start seeing a retracement of the entire MTF uptrend that has been in play since mid-December. This has not happened yet, but it easily could if the black trendline breaks.

Ready to retraceBTC chart by TradingView

The $9,100 level would be a good place for Bitcoin to hold, as it was an important resistance level, and almost confluent with the .382 Fibonacci level. Also here, we see that the 50 and 200 day moving averages are going to cross in a few days – a Golden Cross. Although this is most often a bullish indicator, it would not prevent a MTF correction from occurring.

Moving to a 2-day chart, we see the October high (Gemini) is holding as a rejection point, furthering the likelihood of a MTF reversal to the downside. Of course, this is Bitcoin, and it could just as easily melt through this level before correcting.

dominance polarity shiftingBTC chart by TradingView

The star of the show here is the Bitcoin dominance chart, and obversely, the altcoins “Others” dominance chart. Bitcoin is just about to crash back through a 63% level on the dominance chart, which has some historical significance. We are likely to see some chop here as the leading crypto engages with this level.

On the Others chart, we likewise see dominance already blowing through a historic level, at about 7.3%. This uptrend seems likely to continue, and Bitcoin’s dominance likely to continue falling throughout 2020 – but reversals within that timeframe are also likely.

Finally, on the 1-hour chart, we are seeing some extreme chop around the $10,500 resistance level. A vicious battle is going on, after the bulls tried to invalidate the start of a LTF downtrend by pushing above the breakdown point – only to have their invalidation move barely held in check exactly at the top of the market.

merciless chopBTC chart by TradingView

This price action is simply too close to call, and either side could end up on top. But either way, the MTF uptrend is stretched; it will correct either now or later, but it will.

The views and opinions expressed here do not reflect those of CryptoGlobe.com and do not constitute financial advice. Always do your own research.

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