Bitcoin Weekly Chart fires bottom signals on opening
In this episode of NewsBTC’s daily technical analysis videos, we take a closer look at a number of bullish signals in Bitcoin that were fired with the most recent weekly open. However, the cryptocurrency market is not out of the woods, as this week will have to confirm the signals with a strong finish.
Check out the video below:
VIDEO: Bitcoin (BTCUSD) Price Analysis: September 12, 2022
Last night we had a weekly close in Bitcoin and have already added almost 3% on top of around 16% from the lows that swept during last week’s candle. As a result of the move, several bullish signals have shot on the open candle. But it is important that BTCUSD remains above the current levels to confirm the signals with a full weekly candle.
Examining the weekly buy signals for BTCUSD
The weekly opened with a bullish crossover of the LMACD. Even a weekly candle and a confirmed crossover can be a trap, as we have seen coming down in the BTCUSD weekly charts. However, it is where the crossover happens from that is particularly notable.
Bullish crossovers of the LMACD during previous bear markets at such a level have resulted in a long-term bottom and sustained bull run. Momentum in both the 2018 and 2014 bear markets fell to the same level.
BTCUSD weekly is also working on a buy signal on the Relative Strength Index, according to the tool’s creator, J. Welles Wilder Jr. The buy signal is activated when the RSI falls under oversold conditions, and then rises from below the threshold.
If the RSI does not restore oversold conditions on the next pullback, we have an important factor to generate the buy signal. The RSI must then make a higher high. Comparison with the bottom of the 2018 bear market shows this exact behavior and its impact.
Comparing past Bitcoin bear market buy signals | Source: BTCUSD on TradingView.com
Reversal Target Retest of $32,000 Support Turned Resistance
If at all the bottom in Bitcoin is in, the next logical target would be to first close above the middle Bollinger band, then push to the opposite side of the bands at about $32,000.
On Ichimoku, the Kijun-sen is roughly at the same level as the upper Bollinger Band, highlighting a clear level of importance for weekly timeframes. Just like the last bear market, Bitcoin has just taken the Tenkan, and a cloud turn occurred after a bottom was already in.
Indicator dynamic resistance could give a target of $32K | Source: BTCUSD on TradingView.com
Related Reading: SEE: Bitcoin, Wyckoff Theory, And The Composite Man | BTCUSD September 8, 2022
Could a 3-month, 300% rally be in the cards for Bitcoin?
Since the state of the 2018 bear market bottom looks so similar at the moment, let’s use the bar pattern to project the 2019 rally from where we are now.
The result is a return to all-time highs. If you remember, the 2019 rally only took three months before BTC gained 300%. It did not set another high until almost another 18 months later.
The 2019 rally resulted in over 300% growth | Source: BTCUSD on TradingView.com
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Featured image from iStockPhoto, Charts from TradingView.com
