Bitcoin Price Analysis: Further recovery to gain traction above 61.8% Fib

By March 23, 2020bitcoin-ms
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  • BTC/USD reverses half the Friday’s sell-off, flashing green on Sunday.
  • BTC bulls look to consolidate before the next push higher.
  • Two consecutive Doji candles on daily chart to be a concern for the bulls?

Bitcoin (BTC/USD), the world’s largest cryptocurrency, consolidates Saturday’s sharp recovery from a drop to 5861.85 lows, as the bulls take a breather before the next push higher. The No.1 coin has reversed half the Friday’s slump to sub-5700 levels and now trades +2% near 6325 region after the recovery fizzled out near 6450. In Sunday’s trading so far, Bitcoin’s market capitalization has increased to $115.35 billion from about $112 billion seen on Saturday while it remains on track to book a 20% weekly gain.

Technical Overview

BTC/USD 1-hour chart

Technically, as observed on the hourly chart, the coin has risen back above all major Simple Moving Averages (HMA), with the immediate upside capped around 6450 region, the 61.8% Fibonacci Retracement level of Friday’s decline (from 6951.22 to 5666.65) and Saturday’s high. A sustained break above the aforementioned resistance will offer a fresh boost to the BTC bulls, as the recovery will regain traction towards a retest of the 7k mark. The hourly Relative Strength Index (RSI) is back above the midline and inches higher, still well below the overbought territory that points to the further upside in store.

On the flip side, the next support is aligned at the horizontal 50-HMA of 6282.45, below which the 6200 area will be tested, the confluence of the 38.2% Fib and upward sloping 21-HMA. Further south, if the 6000 phycological level gives way then the intersection of the 23.6% Fib and 100-HMA between 5965-5940 will come into play.

However, the upside looks more compelling above the 61.8% level amid a lack of key resistances limiting the bulls. Despite a more optimistic view in the near-term, the spot still remains exposed to downside risks, cautioned by the two consecutive Doji candles formed on the daily chart. Doji candlestick, usually, signals indecision and here it could suggest buyers’ exhaustion following a recovery from yearly lows of 3886.48 reached on March, 13th.

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BTC bulls look to consolidate before the next push higher.

Two consecutive Doji candles on daily chart […]

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