Bitcoin is looking to make nice moves over the next few weeks as some positive indicators flashed on the weekly chart. Besides this, this week’s Crypto space has been blessed with at; least $1000 worth of APTOS airdrop, and people now have some free money to spend.
Will they use it to buy Bitcoin? Let’s dive into this week’s analysis and find out.
Last week’s analysis found Bitcoin nearly at the end of a common market structure: The Descending Triangle. Since then, BTC has dropped by about $600 and is currently trading at $19,056. The multi-month descending triangle spells doom for Bitcoin, even though a new positive indicator just appeared.
However, before we move on to the good news, here is a brief revisit to descending triangles.
While 63% of the time, they break downwards, there is a 37% chance that we see a huge move to the upside.
It is possible to predict the direction of a breakout by combining market structure with other indicators. In this case, the additional indicator is the Moving Average Convergence/Divergence (MACD).
The MACD is a technical indicator commonly used to identify a new trend (bullish or bearish). Generally, the blue line is the fast-moving average, while the red line is the slow moving average. When the fast-moving MA crosses from under the slow-moving MA, it indicates a new uptrend.
On the other hand, if the fast-moving MA crosses from above the slow-moving MA, it indicates a new downtrend.
Application to Bitcoin Chart
The BTC chart below (Weekly) indicates several times in the lifetime of Bitcoin when bullish MACD crosses happened and the results on the asset’s price. If you look keenly, you can observe the crosses around 2015, 2019, and, most recently, a few weeks ago.
Bitcoin might be seeing a move to the downside this coming week and might test the $18,500 region. In the 4H chart, Bitcoin ranges between $19,500 and $19,000. These two zones represent buy-side and sell-side liquidity. This means smart money and exchanges are using this range to suck retail traders dry before they push prices in one (pre-determined) direction.
But what is this pre-determined direction? MACD says up, but the market structure says down. We are looking for a break in the market structure (A.K.A Market Shift) before we can conclusively say we are bullish or bearish. However, there are bullish undertones in the price action for the remaining months of 2022 going into 2023.
Current Price: $19,056
Verdict Next Week: Range between $19,500 and $18,500
Verdict October: Bullish
Seems like that APTOS stimulus cheque might just be used to buy BTC in anticipation of the bullish move coming in November.
Vincent Munene is a freelance writer and a great blockchain enthusiast. Blockchain has changed his life in terms of financial freedom and in return, he likes to educate people and keep them up to date on everything blockchain. He is a Biochemist by profession and also loves to play the piano.