Namaste to all #Hive and #Leo finance community members. 🙏
Just a few days ago I posted my first analysis on Bitcoin, In which we considered those levels as important support and talked about buying at those levels with proper trade setup. Now the rally we have seen in the price of Bitcoin in the last few days has been spectacular. I hope that you all have enjoyed this rally to the fullest and made good profits.
Click here to go through my previous analysis on Bitcoin.
Image by freepik | Edited on canva
Important points that we discussed in our last analysis are:
- On the daily time frame we identified an up trendline and a key psychological support level, which you can see in white and yellow color in the image below.
- We've also seen continuous buying from the lower levels in the form of long lower wicks which signifies strength.
- Since the previous swing low was near 25000, this is a round number which is also seen as a psychological level. Therefore we consider it an important support.
- On the upside, we considered 26500 as an immediate important hurdle. This means any candle closed above 26500 will be considered as a sign of bullishness.
Image by tradingview | 1 Day time frame.
In the image shown above you can see a white cross sign which signifies that the price has broken below the uptrend, you also can see a little white circle which shows a big but failed attempt by buyers to drive up the prices, and you can see a yellow ellipse area which is showing continuous buying from the lower levels.
Besides all this in the grey rectangular area, you see the price action of the following days from our analysis.
Image by tradingview | 4-hour time frame chart.
The above image is of the same price action of the following days from our previous analysis but in a 4-hour time frame chart.
As you can see point number 1 was the first attempt by the buyers to drive up the prices after our previous analysis.
Point number 2 shows an unsuccessful attempt by the bears to pull down the prices.
Point number 3 shows another attempt by the buyers to break our key resistance of 26500 which eventually happened and the candle of September 14th managed to close above our important resistance level. After this, we also saw a follow-up movement which then took the price to 27515.
*Now you can also see a white rectangular area in the chart above which will basically act as important support as this is the area from where the price decided to rise. However, after breaking above, technically the price should have reversed from the upper surface of this area, which means trading in this area is not a good sign.
Now let's understand the strategy to trade bitcoin for the next few days.
I will continue with my analysis and I will wait for the price to break above this area after which I will look for buying opportunities. Bitcoin may resume its uptrend above 27515 which can take it to 27600, 27850, 28200, and 28600.
Also unless the price falls below 26300, any kind of selling will not be technically correct. So, we will closely monitor this level and once it breaks below we will take short positions for the target of 26100, 25800, and 25650.
And as always, Instead of thinking like a buyer or a seller, we have to think like an opportunist. No matter which direction the price moves, we have to confirm the follow-up movement before placing any order.