Bitcoin Finds Support Near 100-Day Moving Average
After facing rejection at the $48K resistance level, Bitcoin has found support near the crucial 100-day moving average. This has led to a slight retracement in the price. However, if a pullback occurs, there is a high possibility of a renewed bearish leg targeting significant support at $38K.
Technical Analysis
By Shayan
Daily Chart Analysis
Upon analyzing the daily chart, it is evident that Bitcoin sought support around the middle boundary of the ascending channel and the significant 100-day moving average at $39K. This has resulted in a slight correction towards the fair value gap between $43,578 and $45,606.
This price range may act as resistance against further selling pressure and potentially push the price back towards the 100-day moving average. However, if the critical moving average is breached, it could pave the way for a mid-term bearish trend.
4-Hour Chart Analysis
An examination of the 4-hour chart shows that Bitcoin dipped below the lower boundary of the ascending flag, reaching the support zone around $39K and the 0.5 Fibonacci retracement level. This led to a bullish surge and retracement towards a critical resistance marked by the lower boundary of the ascending flag.
However, Bitcoin is currently in the process of completing a pullback to the broken flag, indicating a potential renewed bearish phase. If this pullback is successful, the market should expect a mid-term descent towards the significant support region at $38K.
On-chain Analysis
By Shayan
The behavior of Bitcoin miners plays a crucial role in the market, especially after the recent surge above $40K. The Miners’ Position Index Metric (MPI) shows the ratio of total miner outflow to its one-year moving average. A higher MPI value suggests potential selling activity from miners.
The chart indicates a significant increase in MPI during Bitcoin’s upward movement. However, based on the analysis, concerns of capitulation are minimal as miners have already secured profits and strengthened their financial positions.
This resilience suggests that miners can withstand potential deeper corrections in the BTC market. However, if selling behavior among miners continues, it could lead to an oversupply of Bitcoin and result in a substantial price crash.
Hot Take: Bitcoin Finds Support but Faces Bearish Outlook
Bitcoin has found support near the 100-day moving average after facing rejection at the $48K resistance level. However, if a pullback occurs, there is a high likelihood of a renewed bearish leg targeting significant support at $38K. Technical analysis of both the daily and 4-hour charts indicates potential resistance levels and a possible mid-term descent in price. On-chain analysis shows that Bitcoin miners have fortified their financial positions, but continued selling behavior could lead to an oversupply and a substantial price crash. Overall, while Bitcoin has found temporary support, the outlook remains bearish.
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