The king of cryptos at the crossroads! – As I feared, September does not start well. This confirms at time T that this is a traditionally inglorious month for risky asset classes. And less so during the bearish run, as was the case for Bitcoin (BTC) in 2014 and 2018. It seems that 2022 will not escape this fatality, although all hopes are still open.
Furthermore, the gains from its technical bounce since mid-June have evaporated in the space of two weeks. Story that sellers consider it a point of honor that the bearish streak in BTC prices since its last ATH in November 2021 is ready to restart. Like it or not, the lackluster backdrop for financial markets is more likely to tip to the wrong side of the fence. To the point that the king of cryptocurrencies could lose a lot.
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Bitcoin in monthly units: back to the harsh reality of the bear run!
July was full of promise. But unfortunately the second half of August proved fatal. It is from prices close to its lows of the year that Bitcoin begins the month of September with the reputation of being the worst performer in several years. Let’s be honest! The king of crypto is somehow against the wall.
The last monthly closing (in August) is not reassuring. Because precisely, it almost encompasses that of July. From now on, the $20,000 support, which had been holding up well, might finally give way. And with a Fed determined to continue its monetary tightening, sellers would be in a strong position to deliver the last blow of the bearish run.
In the meantime, investors shouldn’t worry too much about the supposedly healthy prices relative to the Ichimoku. On the one hand, the Chikou Span although above the Kumo (cloud), would bog down below BTC prices in the coming months except reassembled exceptional. And on the other hand, the bearish cross between the Tenkan and the Kijun against the first, would possibly constitute a counterweight to a return to a bullish cycle. With the fear that the king of cryptocurrencies could spend 2023 as a year of transition or stagnation after the end of his bear run yet to be defined.
Bitcoin in weekly units
Subject to a close above $19,557, Bitcoin could break out of the three-way pass into the bright red. Nevertheless, prices fail to climb the slope to move away from the support break at $20,000. This threat is becoming persistent. Especially since sellers are starting to test this critical level. At the moment, there is no fire on the lake. But we will have to wait for aftershocks, hoping that this weekend does not end in the worst possible way.
For now, I see that nothing has really changed regarding the price position of BTC and Chikou Span vs. Kumo since last May. Hence my justified pessimism about a possible reversal of the bearish streak. Even a cross of the descending line would not allow to consider it given the weekly Kijun price deviation and the significant thickness of the Kumo future. Which would still keep the Chikou Span under the cloud.
The best case scenario we could hope for would be to quickly recapture the summer highs around the $26,000 resistance. in condition condition sine qua non to iron the weekly Tenkan. Otherwise, the sellers would bury the last hopes of the buyers by pushing Bitcoin prices towards the $12,000 support.
Bitcoin in daily units: last chance pullback at $20,000?
Now that Bitcoin has reached the final target of the rising wedge, sellers are moderating as they await catalysts that are likely to drive the point home towards $12,000 for good. So much so that the triple bottom drawn during previous market points no longer holds water. Now the prices are simultaneously below the Tenkan and the Kumo. Fortunately, they are preserving the $20,000 support as we speak. Which would potentially offer a last chance pullback.
If this favorable technical signal were to materialize on daily units, BTC prices would cross the Tenkan in the first instance. But in an effort to stop the bleeding from the last two weeks, a price move beyond the Kumo would be vital as prices could favorably threaten the falling line and resistance at $26,000. This would be consistent with a return of the Chikou Span within the cloud.
While this is my personal belief, we are closer to resuming Bitcoin’s bear run since its last ATH in November 2021. Not only does the Fed’s continued monetary tightening not help risk appetite. But to make matters worse, the renewed intensity of current uncertainties in financial markets could dump oil again on the most liquidity-sensitive asset classes, and more particularly cryptocurrencies.
What matters most to me is to analyze the price structure, especially in long-term units. And it is clear that the weekly chart would seem more instructive to me than the monthly chart. Because without the presence of top-tier catalysts, the king of crypto prices would have all the trouble in the world to cross the significant Kumo thickness projected in Q1 2023. Enough to be biting your nails for a new bull run. .
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