November 3, 2022
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Bitcoin Rally: Bull Trap or Start of a Bull Wave? Technical Analysis
BTC USD20253.00 (3 November 2022, 22.11 IST)
Bitcoin’s short-term price action is still hanging in the balance, as it is currently consolidating in a key area. The next few days could determine whether the recent rally was really the beginning of a new bull market or just another bull trap.
On the daily timeframe, after breaking above the long-term bearish trendline and retesting both the trendline and $18K, the price has been trapped between two significant dynamic levels; the 50-day and 100-day moving average lines, located around $20K and $21K.
The cryptocurrency has been consolidating in this range since breaking the 50-day moving average to the upside but is yet to close above the 100-day MA.
A bullish breakout could lead to a rally toward the 200-day MA and the $24K resistance level, which are both strong barriers to be surpassed before anticipating the beginning of a new bull market.
On the other hand, in the event of a deeper pullback, the significant $18K support level could come into play once more. However, it may not be reliable as it has already been tested on multiple occasions recently and, as a result, should be considerably weakened.The 4-Hour Chart
On the 4-hour timeframe, the price has been consolidating around the $20K area for the last few days after breaking above both the $20K level and the long-term bearish trendline.
A symmetrical triangle is seemingly forming in this timeframe and could offer a useful framework for analysis. These patterns could be either sign of continuation or reversal, depending on the direction in which a valid breakout occurs.
A break below this triangle could lead to a drop toward the $18K level, and conversely, a breakout to the upside would likely initiate a rally toward the $22,500 resistance level.
Furthermore, the RSI indicator is currently trending below the 50% level but is still far from the oversold area, indicating that the momentum is shifting in the bears’ favor, and a bearish breakout could be slightly more probable at this moment.Onchain Analysis
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Technical analysis with chart is impressive. Congrats for this new efforts and venture.
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congrats