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6. March 2023Market Analysis 09/29/2022
6. March 2023The market technical development of Bitcoin!
If Jerome Powell's words in the last FED meeting on 09/21/2022 are anything to go by, the markets must fall. In summary, the situation is this: the markets must go down and if there are capitulations in the markets, the FED will not save the markets. You can't deliver more power to the bears. The FED wants to get inflation under control, whatever the cost. In the meantime, several major banks have already reacted to this and stopped lending for the purchase of digital assets. Bitcoin and other digital assets will soon feel the effects of this measure. Nevertheless, the situation is not all that bad. Regulatory efforts in the US are making progress and are benevolent towards digital assets. The current discussion is whether to classify digital assets as commodities, which could be extremely positive for Bitcoin. The fact that Bitcoin's accumulation is still unbroken is very positive in itself, but we must not be fooled by the fact that we are still in a tangible bear market and that it is far from over. In our overall market analysis(09/15/2022) we have already outlined the current downtrend. Despite the bear market, bull market rallies can occur for individual assets, where the prediction has already come true for XRP. A bull market rally is currently not in sight for Bitcoin.
The weekly chart gives some hope, even if this hope is rather optimism for a purpose. Bitcoin has been near zone 1 of the price cluster since around mid-June. Whether this is a firm support or can already be declared a firm bottom is not yet clear. The decision, however, is approaching. As we already reported in detail in our last analysis, Bitcoin simply does not make it above the key resistances. One of these important resistances is the sloping dashed support line of its actual downtrend channel, which should actually provide support on the downside. Now, however, it is acting as a strong resistance. In the same vicinity is the MA 10 moving average, which has already been acting as resistance for a fortnight and is not letting Bitcoin cross over. This is followed shortly by resistance at 22,489.-USDT and the most important moving average MA 200. All three resistances are so strong in total that it significantly increases the probability that we will soon see further falling prices. If there is a sell-off, the strong support at 18,509 may still offer support. The next support is at 15,644, which is not particularly strong. After that, we continue to zone 0 of the price cluster, from where the last bull cycle began.
The daily chart shows a clear sideways movement in zone 1 of the price cluster. Here, too, the MA 10 moving average serves as strong resistance. The MA 10 gets support from the resistance at 19,428.-USDT, which is also the upper side of zone 1. What is somewhat positive is that the distance between the MA 100 and MA 200 moving averages is still very large. This could be reason for the bulls to join forces and push Bitcoin higher. But due to macroeconomic factors, it is likely that the bulls will still hold back. If inflation figures fall in October, a bull market rally would be quite conceivable. But until then, we have to hope that the strong support at 18,509 will hold. All in all, the daily chart does not really show a bullish outlook, but rather the potential for further sell-offs.
On the h4 chart, the valley of tears is widening. The only support Bitcoin receives is the MA 10 moving average. Opposite it, the MA 50 holds its ground as strong resistance, already entering zone 1 of the price cluster. As before, we see lower lows and lower highs. Not necessarily the best conditions for the bulls, who still have to be patient. The bears have a firm grip on Bitcoin. A possible bullish crossover of the moving averages is not in sight. Therefore, the signs on the h4 chart also point to selling. Yes, Bitcoin has not had it easy lately. Not only because of the disastrous situation on the markets. Bitcoin is coming under pressure again and again in the political discussion regarding its energy-intensive mining. Other digital assets currently hold the better cards. But let's not give up hope for this year. Bitcoin is approaching a possible breakout channel to the upside. In the US, the elections are going into the finals, which can basically provide a boost. This also coincides very well with our overall market analysis, where a new uptrend could take place in mid to late October. The only question is from where the uptrend starts. We actually have a capitulation ahead of us in the current cycles for Bitcoin to end its bear market cycle. I see a possible bottom between 12,000.00USDT and 14,000.00USDT.
The chart development of the entire market!
Overview of the market depth!
The volume price trend in the relative strength index has moved from a short green phase back into the red phase, indicating a trend reversal. The AI trend, which previously served as support, is now clear resistance again.
The volume of the bear market rally was, as we had already predicted, rather thin.
The cash money flow shows that large investors are currently very cautious. The market is dominated by small investors. According to the ON-Chain data, however, institutional investors are currently on the sidelines.
Greed and Fear! You can see very clearly the individual phases of each cycle. The first phase is always extreme, the second phase normal and the third phase cools down and indicates a trend reversal. Currently we have left the first phase of extreme fear and were partly in the lower range of greed. However, fear is on the rise again and thus there are increasing signs that the second phase of fear in the bear market is beginning. However, this should no longer be as strong.
The two lines, AI trend and MA 200 opened the bear market in January. The AI trend is flattening out and slowly moving into a sideways line. Accordingly, the massive downward pressure should decrease.
The Google trend has grown since the crash and the demand in search engines is increasing. At 76, we recently marked a high last seen in the May 2021 crash. After that, prices recovered and we were able to reach a new all-time high. Currently we have a score of 20, previously it was 25. Source: Google Trend
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Erik Wimmer
Passionate programmer and machine learning developer. Trader in Forex since 2016, in digital currencies since 2018. Erik Wimmer, a programmer from Tyrol, is the deputy managing director and technical developer of Quantum Data Analytics GmbH.
The author, Erik Wimmer, confirms that he may be invested in this digital asset mentioned at any time. A conflict of interest could arise as a result. Erik Wimmer affirms that he has prepared each analysis in compliance with journalistic duties of care, in particular the duty to report truthfully and with the requisite expertise, care and diligence.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Quantum Data Analytics GmbH. Any investment or trading move involves risk and we advise you to seek other opinions as well. We do not recommend buying or selling decisions! You trade at your own risk! Quantum Data Analytics and Erik Wimmer are not liable for any losses incurred directly or indirectly as a result of any action taken in relation to the contents of the publications.
