Bitcoin is more expensive than $4000, can we talk about recovery?

28.03.2019 12:44:16

Finally, we saw Bitcoin above $4,000. Bitcoin sought to this mark for almost a year. Now Bitcoin costs $4084. Many enthusiastic traders started saying that it is Bitcoin recovery. Is it so?

Daily chart

If you look at the 4-hour and daily chart of BTC/USD, you can see the formation of the ascending channel. But such a channel was already formed in December 2018. Then Bitcoin reached $4,200 and dropped to $3,400. Then with the growth of prices trading volume increased too. Now the price is rising, and the trading volume is falling. And this is one of the conditions why the price of Bitcoin will fall. But if we see a sharp increase in trading volumes, due to the growth that has begun, the price may go higher.

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If you look at the daily chart, the downward trend prevails, and the 20-week moving average remains resistance for the BTC/USD pair. And it seems that the nearest resistance levels of $4,100 and $4,400 on the daily and 4-hour charts, the BTC/USD pair will not be able to pass quickly.

Weekly chart

On the weekly chart, the BTC/USD pair is trading between the 200-week and 20-week moving averages, which are getting closer to each other every week. 2 Weeks ago, Bitcoin rose above the 20-week moving average. But trading volume continues to decline, saying that the movement may not last. In the face of rising prices and declining trading volumes, we can speak of divergence.

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The Stochastic RSI indicator is forming in the overbought zone, showing signs of a bearish cross.

Conclusion

Bitcoin has key resistance levels on its way. If the price holds above key resistance levels, this may be a sign of Bitcoin growth. However, this scenario is less likely, since other conditions suggest its possible reduction.