Rolling out microplatforms, $2.25M, Investors fromBitcoin has been rangebound for most of the week. It was trading at the crossroad between last week’s falling trendline and this week’s rising one. During the April 30 session however, we saw a bullish push that could be a sign of more upside risk to come. But let’s not get ahead of ourselves. First take a look at the 1H chart.
We can see that price rebounded from 214 at the beginning of the week and consolidated during mid-week between the converging trendlines. It was also trapped between the moving averages. However, we did see the 1H RSI tag 70, which showed initiation of the bullish momentum. It remained above 40, which showed maintenance of that bullish momentum. Then during the April 30 session, this bullish momentum continued as the 1H RSI popped up above 70 again., and price popped up above the moving averages as well as last week’s falling trendline. BTCUSD even broke above last week’s high around 238 and tagged 240 before stalling to start the May 1st global session.
Now, before we become bullish on bitcoin, let’s first expect at least some near-term bearish attempt as price action developed a bearish divergence with the RSI. Since the “uptrend” is still young, we should still respect the medium-term bearish bias, which we will see in the 4H chart.
In the 4H chart we can see that the bearish momentum lost as the RSI cleared above 60. It even tagged 70, which shows some bullish momentum. Furthermore, price has broken a falling trendline coming down from the March high just above 300. From the short-term perspective, it is reasonable to expect further upside.
However, because the prevailing trend was bearish, we should consider a neutral mode scenario before jumping to a bullish conclusion. In this scenario, because the RSI is showing overbought conditions and price is essentially tagging a key support/resistance pivot area, we should expect a dip towards the 230 level. Another reason to look for a bearish attempt is that the rally this week completed an ABC correction structure, which can reflect the end of a correction cycle.
If price holds under 240, and returns below 230, we would essentially have completed an expanded flat, which means there is still downside risk.
Now, if price can hold above 230, we can start adding confidence towards the bullish scenario. Otherwise, the market would still be neutral-bearish, especially if the 4H RSI also falls below 40.
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