Bitcoin held steady above the $42,000 zone and in the past hour, the leading crypto asset changed hands from $42,425 to $42,597 on Wednesday morning around 9:30 am Eastern time. The digital currency’s market valuation as of January 17, 2024 is approximately $835 billion, with $25.65 billion in global trades in the past day.
Bitcoin
Bitcoin’s 1-hour chart presents a consolidation scene, with BTC price movements showing less directionality than on longer time frames. Notably, there was a sharp decline to around $42,056, perhaps indicating a clearing of stop-loss orders or a brief panic sell-off following spot approvals of Bitcoin Exchange Traded Funds (ETFs). However, the market quickly recovered from this decline.
The 4-hour chart paints a clearer picture of a downtrend, characterized by lower highs and lower lows. Volume on dips was noticeably higher, suggesting greater selling pressure. Resistance formed near the $45,000 level, which had previously acted as support. The path to least resistance is clearly negative on Wednesday as the market still has bearish undertones.
The daily chart reinforces the long-term downtrend observed in the 4-hour analysis. A significant long-term support area lies around $36,727, a level from which the price had previously recovered considerably. The current price movement has been limited within a range between this support and the resistance level of around $45,000. For long-term positions, entry points could be considered near the bottom of this range, with confirmation of support being maintained.
Bitcoin oscillators were mostly neutral on January 17, 2024. The Relative Strength Index (RSI) stood at 47, the Stochastic at 17, and the Commodity Channel Index (CCI) at -61, all indicating neutrality. However, the momentum indicator at -1365 and the moving average convergence/divergence (MACD) level at 83 suggest a bearish undertone to the overall neutral outlook.
Bitcoin’s moving averages (MA) are also providing mixed signals. The short-term exponential moving averages (EMA) and simple moving averages (SMA) for 10, 20 and 30 days indicate negative sentiment, while the longer-term averages for 50, 100 and 200 days suggest that bullish sentiment is still strong. This disparity highlighted a tension between immediate bearish trends and a potential long-term bullish undercurrent.
Bull verdict:
Despite mixed signals and short-term bearish trends, the long-term outlook for BTC remains positive. The resilience shown at major support levels, combined with the buying interest reflected in the long-term moving averages, suggests a potential upward trajectory. Investors with a long-term perspective may find this an opportune time to consider entry, as the market may be preparing for a bullish reversal.
Bear Verdict:
Bearish indicators dominating short-term charts indicate an ongoing downtrend for bitcoin. Lower highs and lower lows, particularly evident on the 4-hour chart, along with increased selling pressure and bearish oscillator readings, suggest that the market may continue to face downside pressure. Short-term traders may find opportunities in short positions, taking advantage of pullbacks and resistance levels.
