Bitcoin $50k Party: Price Analysis

Bitcoin Price Analysis Feb 18, 2021

Okay, we're in a situation where Bitcoin has finally crossed above $50k, so what do we do now?

Take a Quick Look at Our Fib Scales From Before

Remember this chart?

That Fib chart dictated that the price would be smooshed between the $52.5k-$53k point.

Let's see where the price is at the time of writing:

Not exactly where our Fibs were placed at but...mighty damn close, wouldn't you concur?

Bitcoin Price Analysis

If we pan back out on this chart (daily resolution), we can actually see that Bitcoin is just now emerging out of a healthy consolidation period.

https://www.tradingview.com/x/7voBUVvD/

If you're a bear (someone looking to place a mean short on Bitcoin), then this is bad news for you, because the price action that we see above reflects the trappings of a healthy price increase.

Quick Look at the Volume For Bitcoin

https://www.tradingview.com/x/hwLc44ze/

As a quick tip to everyone that's using TradingView, yo should swap charts from what you see above. Specifically, I'm referring to changing the market for the chart.

Right now we're on Bitstamp, but we're looking to evaluate Bitcoin's overall volume and there's a good chance that Bitstamp by itself may not be indicative of that.

Just in case it isn't, we're going to go to the "BLX" chart  which has historical data for Bitcoin as well as an aggregate average of all of the tracked exchanges on TradingView (and TV has a decent sample of the exchanges in crypto that can be considered semi reliable).

Let's see what it shows us:

https://www.tradingview.com/x/188GWf1X/

Actually Analyzing the Volume Now

We don't see any divergence, which is interesting because if you look at the price action,  the most recent price candle (February 17th, 2021), has the appearance you would expect after a breakthrough above the overhead resistance.

https://www.tradingview.com/x/nIAb8UIw/

Brief Look at the Ichimoku

This is actually another one that we rarely look at, but its worth taking a view now since its so predictive in nature.

See below:

https://www.tradingview.com/x/hXcJMg4U/

As we can see all projections for the price by the Ichimoku have been successfully beat.

The closest support set by the Tenkan Sen under the price at the $48k.

Beyond that:

  1. Senkou Span A > Span B (cloud) plus the price is above the cloud itself.
  2. Tenkan Sen > Kijun Sen which is a bullish cross for the Ichimoku
  3. The Tenkan Sen and Kijun Sen are above the cloud itself. This is very bullish. Many don't know that this is another valid cross / signal produced by the Ichimoku
  4. The lagging span is irrelevant at this point because we're witnessing the price rise the Chikou.

Relative Strength Index(14)

This is looking pretty bullish right now on the daily resolution.

See below

https://www.tradingview.com/x/InwIPBKf/

The RSI(14) has been pretty unequivocal in its reading here.

We can see that its been trending upward since the end of January and appears that it will continue its trajectory.

At 82.36, the RSI isn't in any extraordinary condition to where we should be anticipating a sell-off out of nowhere.

Balance of Power RSI

I'm going to this one next (custom indicator), because it  often gives us early signs of divergence whenever there is any present.

Let's check out what its showing us below

https://www.tradingview.com/x/aD5zqjAU/

As we can see the Balance of Power RSI is healthy right now.

There was where the reading was showing us that the upward buy pressure was at an extreme (relative to what its been over the past 7 or so periods), but it appears that the downward trajectory of the indicator was resolved with the consolidation period that we observed earlier (where the price was moving sideways).

So that's another bullish indicator for us for Bitcoin.

Librehash Reversion Ribbon V2

This is another indicator that's going to provide a critical reading for us due to its tendency to catch signs of behind the scenes sell-offs.

Let's take a look at where it is currently

https://www.tradingview.com/x/7JiUVXaP/

Once again, it appears that we're able to see that the indicator tracked the consolidation period accurately and is now back on a trajectory to travel northward.

However, there is one observation that we want to pay close attention to.

https://www.tradingview.com/x/fgWLHJSz/

In the chart above, we can see that the indicator was reflecting heavy buy pressure, even during periods of consolidation.

https://www.tradingview.com/x/yxNNZe6h/

What we see in the chart above is really interesting because we can see that the price is still moving upward despite the very light pressure underneath it, which is rare to see with a market this bullish.

Usually, its feast or famine with hardly any famine.

But what we see above appears to reflect that:

  1. Bulls are feeling some trepidation about where the price is currently.
  2. At the same time, there don't appear to be individuals willing to sell or bears willing to risk getting murdered on a short at this range.

This was reflected in the volume as well to a certain extent where we saw a very light increase from one candle to the next for each period, showing that the volume and price were technically aligned but appeared to be making very quiet, tip toes forward past the 50k mark.

Conclusion

Bitcoin is still bullish for the time being.

Probably even ripe for an entry to be honest.

Since the price is above $50k, we now have a really strong reference point for where our support should be at.

So let's go ahead and chart that one out.

Here's the R/R

https://www.tradingview.com/x/gKX2sn3H/

Tags

cryptomedication

Happy to serve and help wherever I'm needed in the blockchain space. #Education #EthicalContent #BringingLibretotheForefront

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