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Bitcoin Friday: Technical analysis of Bitcoin

Today, like every Friday, I have prepared a technical analysis of Bitcoin. We will look at key levels, as well as the next possible movement.

Current situation

Before we move on to a specific Bitcoin chart, we should describe the current market situation. In recent days, we have seen a great correlation in the whole market. Bitcoin is in decline, but it is not Bitcoin alone. Quite the opposite. Stocks, commodities, and indices are also falling. What could be the reason behind this?

Of course, we can’t be entirely sure, but as I have been saying for quite some week already, something is happening on the market. Something is wrong and Bitcoin pays for it. Overall, Bitcoin is has been experiencing a very weak March so far, and in recent years it has been the rule that during March we could witness the most significant correction.

default 4H Bitcoin chart (source: TradingView)

Weekly chart

If we take look at the weekly chart, we can notice that something is wrong. The black candle that closed last week was too strong because it completely erased the body of the previous candle.

I have already seen several similar candles and the vast majority of them meant the current TOP. Personally, I think that the bull market will continue, but a correction of larger proportions is really inevitable.

default Weekly Bitcoin chart (source: TradingView)

Monthly chart

Furthermore, if we also look at the monthly chart, the top shadow of the candle does not show anything good. If we focus on the bodies of the candles, then we can notice that it has been growing for the last 6 months. From this point of view as well, there would really be a need for some halt (or at least slowdown) in this growth.

Bitcoin monthly chart with price action Monthly Bitcoin chart (source: TradingView)

Conclusion

I don’t think the bull market would end, or the cryptocurrencies in general. Rather, I think that it is finally time for a more extensive correction, which also indicates the price. All the processes that are happening in the background are in order which is good. However, a Bitcoin price chart could really benefit from a monthly correction and it would be a welcome change in pace in the long run as well.

Jakub is a crypto trader and founder of Trader 2.0 project, which helps hundreds of traders from central Europe to understand cryptocurrency trading and its challenges. Jakub not o...

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