Bitcoin Analysis for 2020-03-02 [Premium Analysis]

Bitcoin (BTC) Price Highlights

• The Bitcoin price completed a weekly bearish engulfing candlestick.
• It is trading below the 200-day moving average (MA).
• There is support at $8,300 and $7,800.
• The price is trading in a range of $8,550-$8,975.
• It has broken out above a short-term descending resistance line.

Bearish Engulfing Bitcoin Candlestick

During the week of Feb 24 – March 1, the Bitcoin price created a massive bearish engulfing candlestick, larger than any other since late November 2019. But, while it occurred with significant volume, it was not anything out of the ordinary. Currently, the price has almost reached the $8,400 minor support area, with the next being found at $7,700. The current resistance is at $10,500. The weekly RSI is at 50, and the movement above or below this line can be very indicative of the direction of the trend. So, based on the weekly chart, the Bitcoin price movement is currently at a very critical junction.

Moving Average

On Feb 29, the Bitcoin price fell below its 200-day moving average (MA). In addition, the price has made some version of a lower close for five days. After creating a Doji on March 1, the Bitcoin price has gradually been increasing. An increase that continues and closes above the 200-day MA would suggest that BTC is bullish. Until that occurs, however, the current trend, at least in the daily time-frame is considered bearish. So, to recap the weekly and daily time-frames, the price is approaching strong weekly support, an area that could initiate a reversal. However, the daily chart shows that the current trend is bearish since the price has fallen below the 200-day MA and has created several lower closes. However, yesterday’s and today’s (ongoing) candlestick suggests that the price might want to begin a reversal.

Short-Term Range

In the short-term, the price has been trading in a range between $8,550-$8,975. While it has twice decreased below the support line of the range, it has moved right back up immediately. This is a sign of strength and that the price wants to move upwards. Furthermore, it has just broken out above a descending resistance line and possibly validated it as support. Technical indicators give an interesting picture that shows the price might want to move upwards. Since the range began, the hourly RSI has moved above 50 only twice, on late Feb 28 and today. On Feb 28, the price had yet to break out above the descending resistance line. In addition, while it moved above the 50-hour MA, it decreased below it in the next hourly candlestick. In the current movement the price has broken out above the descending resistance line. In addition, it has broken out above the 50-hour MA and has not fallen below it for five hourly candlesticks. So, this is taken as a sign of strength and that the price might want to move upwards towards the range high. To conclude, the Bitcoin price has reached an area that could initiate a reversal. The current daily candlestick suggests that a reversal is near and the short-term chart already shows a breakout. The price is expected to move upwards towards the range high at $8,975. For those interested in BeInCrypto’s previous Bitcoin analysis, click here.