Home » Towards a correction for Bitcoin (BTC)? The trend at the start of the year is losing momentum

Towards a correction for Bitcoin (BTC)? The trend at the start of the year is losing momentum

by Tim

Following the uptrend, cryptocurrencies are now in a range. Bitcoin (BTC) and Ether (ETH) remain stuck below their psychological resistance levels. Will they manage to break through, or is a correction on the way? Find out in this week’s analysis

Will Bitcoin (BTC) soon return to $25,000?

While the price of bitcoin (BTC) has touched the targets we mentioned in our last analysis, it now seems to be stuck below the psychological zone of $30,000. In fact, round-number thresholds are generally fairly relevant resistance levels to watch.

Figure 1 - Bitcoin Daily price chart

Figure 1 – Bitcoin Daily price chart


Now that the price has broken back through the daily Kijun at $29,000, it needs to confirm this level as support by finally breaking through resistance at $30,000. The current risk is that BTC will be rejected again and will head back down towards the next support level. If the price breaks through $30,000, there is a good chance that it will soar to the high trendline in yellow around $33,000.

For the time being, the support to watch out for in the event of a further correction is at $25,000. Once again, this is a psychological zone that has proved effective as resistance in the past, with 3 contact points and the appearance of the ichimoku cloud. As a reminder, all resistance becomes support once broken on the upside, so this zone should provoke a reaction from Bitcoin in the event of a retest.

A correction is inevitable

On the lower time unit at h4, the price is flat and seems to be waiting for the economic event that will precipitate it towards the breakout of its range between $26,600 and $30,800. Despite a pronounced uptrend on the daily chart, the movement has run out of steam. Confronted with major psychological resistance and the Kijun Daily, Bitcoin should at least correct in the short term to get back on track.

Figure 2 - Bitcoin price chart (h4)

Figure 2 – Bitcoin price chart (h4)


In yellow, an ascending broadening pattern that encompasses the evolution of the BTC price. This type of pattern generally marks the end of a trend and the coming reversal of the market. This pattern is therefore likely to be bearish, with a breakout target of $24,350.

Of course, the bottom of the pattern at $27,400 will have to be broken first, and then the support at $25,000 will have to be breached on the downside. In the meantime, we remain in a directionless market and the best thing to do is to wait for the next move that triggers one of our two scenarios.

To invalidate this pattern, the range will have to be broken at the top, which means breaking back above $30,500.

Ether (ETH) to pull back to $1,570

The price of the Ethereum cryptocurrency, Ether (ETH) is showing the same pattern as Bitcoin. A range of several weeks contained within an ascending broadening pattern. Once again, this chartist pattern is more likely to break on the downside as the price is increasingly volatile and still rising, and a lack of liquidity will inevitably be felt.

Figure 3 - Ether price chart (h4)

Figure 3 – Ether price chart (h4)


Here too, the price is blocked by the Ichimoku cloud and risks being precipitated into a break of the $1,840 side support. If this level is breached, then we should see ETH back at $1,570 (the target for breaking the pattern) fairly quickly.

To invalidate this bearish pattern, we will need to get back above the $2,000 cloud. In the meantime, this zone remains a psychological resistance that Ether is unable to break through.

Conclusion of this technical analysis

Cryptocurrencies have lost speed and are now in a range phase. A correction can not be ruled out in order to recover the liquidity needed to pass the major resistances we have identified.

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