Bitcoin (BTC) Price Trading Analysis – April 19


After closing the weekly session at $56,280 in a bearish engulfing pattern, down 6% from the previous week, BTCUSD staged an abortive recovery in the early trading hours on Monday.

A daily close on Saturday below the key support level of 61165 triggered a rapid, alarming decline on Sunday, leading to roughly $4.9 billion worth of BTC long positions getting liquidated across exchanges.

As illustrated in the chart below, the price bounced off the primary trend line (lower trend line) at $51,500 and eventually secured the .618 Fibonacci level by daily close, but failed to close past the secondary trend line (upper trend line) at $56,900.

BTC1

In the early hours on Monday, an effort to reclaim the secondary trend line was rejected at the first time of asking. If the secondary trend line is not reclaimed by close on Monday, then a retest of the primary trend line could be in the offing. It’s critically important that BTCUSD holds on to the primary trend line.

Since October 2020, daily RSI has held above the all-important bull cycle bottom zone, highlighted in the chart below. Daily RSI is currently at its lowest since November, pending daily close, but still within the zone which must be retained.

BTC2

Chaikin Money Flow (CMF), which last week turned negative for the first time in seven months, is once again approaching negative territory, indicating that sell pressure may still persist.

Key support levels are $54,000 and $51,800. Key resistance levels are $57,500 and $59,100.

Zooming out and taking a long-term perspective of the market, after breaching 90 following March close, monthly RSI may be due for a corrective spell before swinging back to the new ATH price for this bull cycle towards the end of 2021.

BTC3As charted above, during the two previous post-halving rallies in 2013 and 2017, the first monthly RSI reaction low price, $150 in 2013 and $3100 in 2017, became the approximate floor price for the bear cycles that followed, in early 2015 and late 2018 respectively. If this trend were to hold, Bitcoin could be establishing the floor price for the next bear cycle over the next month or so.

It should also be interesting to see whether the end of this corrective phase coincides with the end of tax season in the US. The Federal tax filing deadline for the 2020 tax year was initially set for April 15 but has since been extended to May 17.

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