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Price Analysis : It’s a make-or-break week for Bitcoin

Botsfolio

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3 Jun, 2021

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After consolidating in a broad range since hitting $30,000, Bitcoin (BTC/USD) is navigating higher lows and lower highs on lower timeframes. This narrowing wedge on the chart has a logical endpoint where volatility becomes practically zero — and historically, this results in a major move up or down.

Trader Talk

In a tweet on Tuesday, popular trader Crypto Ed stated:

“When it does, I think we break out to the upside in coming days.”

He added that a failure to break out could have the opposite effect, a nod to those already warning over a possible fresh bearish dip toward $20,000.

A look at the hourly chart, meanwhile, dictates a make-or-break moment for Bitcoin on Wednesday, at which point market trajectory in the near term should be decided.

“Expect volatility by week’s end,” fellow trader Lark Davis added.

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The pattern of sideways trading following a major price move that culminates in a narrowing wedge and breakout — known as “compression” — is a classic chart phenomenon for Bitcoin. The process characterized much of 2020 in particular before the bull market truly kicked in to take BTC/USD past its 2017 all-time highs.

The Classic 50-day Moving Average Support

Usually, while carrying out a technical analysis of a cryptocurrency, EMA is always taken into consideration. Exponential Moving Average abbreviated as EMA, is the basic technical indicators used to determine the price movements. The average value during a certain period of time is considered.

Bitcoin’s 50-week exponential moving average (WEMA) is back as support despite overall lower levels, and historically, this has been a key bull flag.

Another popular analysts Rekt Capital believes, 50 day EMA is one of the strongest support levels since 2013. During the Bitcoin price Bull Run, these levels act as support levels in case of a deep, devastated crash.

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