During the week of March 16-23, the Bitcoin price increased significantly, at a time reaching a high of $ 6,900. However, it has dropped significantly on weekends. Since prices are unable to reclaim this important resistance zone, the movement this week will likely see a retest of bearish support, rather than initiating a bullish move.
Trader Loma has outlined a Bitcoin price chart stating that the weekly outlook seems to be quite bearish as the price is facing very close resistance from multiple levels. However, he is waiting for a breakdown of the zone of $ 5,800 before starting to short.
Waiting for Bitcoin to lose $ 5,800 before I start opening up more shorts.
Weekly looks like absolute garbage though. It has been predominantly looking for shorts and this is why. pic.twitter.com/KyBjfZNAZo
– Loma (@LomahCrypto) March 22, 2020
On February 15, Bitcoin dominance rate hit a low of 61.78%. This level appeared after a continuous period of decline that began in early January, causing many altcoins to increase significantly. However, the trend reversed thereafter and Bitcoin's dominance rate has increased since then, recently breaking out of an important resistance area.
The resistance area was found at 67.5% and the price struggled to move up on it for much of March. However, the price has not confirmed its uptrend.
GalaxTrading analyst tweeted a chart of Bitcoin dominance showing it was bogged down in an ascending wedge, considered a bearish reversal pattern. He hopes that the price will breakdown, allowing altcoins to see profits compared to their BTC pairs.
$ BTC dominance
– GalaxyTrading (@GalaxyTraging) March 23, 2020
Will Bitcoin's dominance rate breakdown or will it continue to decline as it did since February? Let's find out.
The dominance rate of Bitcoin seems to be trading inside an increasing wedge, which has been in effect since February 15. There are two important developments worth keeping an eye on.
First, the region 65.5%, can play a supporting role. The price cannot reclaim this level many times in March before it can finally do so on March 20.
Second, there is the resistance zone at 68%. This area coincides with both the rising resistance line of the wedge and the 200-week MA moving average. Therefore, if the price succeeds in reclaiming this level, we can confidently declare that it is an uptrend.
The support line is ascending
In the long run, the dominance of Bitcoin has followed an ascending support line for 805 days. While it initially broke below this line in February, a recent rise has pushed prices back to this level.
If the price can reach the weekly close above it, it also means that it has surpassed the 200-day MA, confirming its uptrend.
In a nutshell, Bitcoin dominance has reached a very important resistance level. If it succeeds in reclaiming it as a support, the trend is expected to increase in the short term.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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