Make or break as bitcoin hits key resistance at $38 000

Welcome to another edition of TA the easy way, where we look at bitcoin price action with a view to taking profits where they present themselves. As we can see on the 4 hour chart, price has just hit key resistance at $38k, where in the recent past price has stalled and retraced. This is it guys – if price can beak through this resistance today, then we could well be on the way to a further leg up toward testing the ATH (all time high) at $42k.
BTC resistance at 38k 4feb21.png
The RSI on the 4 hour is, however, just touching overbought at 75. Also volume is not in any way significant, suggesting there is not much buying pressure entering the market at this point. As a result price may be about to retrace to the downside. The support can be found at around $30k, which gives a trading range of $8000 or over 26%.

Bitcoin is showing recent bullish momentum, accompanied by continued large institutions actually buying up more bitcoin than what is being mined daily. This is a huge bullish sign, as liquidity dries up and the supply shock continues to mount.

On the 1 hour chart, price has been steadily bouncing up from the 13 MA support, only once dipping as low as the 21 MA yesterday and then continuing upwards. As I write this bitcoin has just retested the previous “Elon Musk pump” top at around $38.7k from last week, on the Bitstamp chart. Volume has spiked slightly on the latest hour candle but selling pressure is keeping price from going any higher for the moment.

Overall, the momentum on the RSI, on the 4 hour chart, has remained bullish for the past seven days, staying close to or above the middle 50 range. Nevertheless, this is the crux or the crunch time right now. Will bitcoin break through the $38k resistance or not?

Fundamentals, sentiment and price action are all mixed on the short term, from my point of view, despite being bullish long term this year, as we continue the bull market cycle. It looks to me like further downside might be incoming. However, will it simply bounce off the 13 MA as usual and continue higher? The situation is too uncertain, so I will sit on the sidelines and observe patiently for now.

If price beaks bullish above $38k with momentum and – very importantly – volume, then may be good to enter a buy trade and go long, riding the momentum up toward $40k as first target and $42k as second target. However, price is dipping now so it seems the resistance is holding. This is just my amateur personal opinion of course. You may have a better insight at this stage, so I wish you well and happy trading.

Posted Using LeoFinance Beta



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Wait and watch, today Elon is tweeting about Doge so he most definitely is having fun and sharing some crypto love around the Twittersphere 😄

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