Bitcoin had a very brutal week, the weekly candle ended. The weekly chart seems to drop as the current weekly candle engulfs 3 candles before it. When prices hovering, there is no volatility, and more frightening declines come closer.
Bitcoin: weekly
Source: TradingView
The weekly time frame shows a 180-degree change in price action. Millions of dollars were liquidated due to this boom. The protests in early 2017, mid-2018 and finally an increase in February 2020 all showed resistance to decrease (as shown in the picture above).
Prices have also escaped excessive collapse thanks to a lower support range from early March 2018 to mid-December 2019. When these lines intersect, prices will fluctuate less, leading to a breakout.
The important thing here is the breakthrough direction, depending on many different factors. The further the breakout point, the more chaotic the result.
Currently, the price is still stable and the hash rate shows an upcoming bearish wave. The blue chart in the Hash Ribbon (in the chart above) shows Bitcoin's hash rate. The smaller this chart, the easier the miner to give up.
The last time it happened, the price was in the range of $ 6,400, leading to the development of the red chart. The global spread of Covid-19 caused many of its assets to fall dramatically.
Miners in China have to close virus farms and most of Bitcoin's hash rate comes from China. This affects a lot of hash rates around the world.
Daily chart – current
Source: TradingView
Hash rates and prices have dropped, causing the entire ecosystem to fall into misery. If this continues, pay attention to the following levels: $ 8,212, $ 7,667, $ 6,853 and $ 6,475.
Although the price of $ 6,400 is not satisfactory, everyone should be mentally prepared in advance.
Moreover, the Fibonacci extends from the low in mid-December to the high in mid-February, showing that we need to pay attention to important levels. Currently, the price is just above the support of $ 8,461 – the Fib-0.5 level. This is an important level and a violation of this level will result in a sharp decline.
Daily chart – Past
Source: TradingView
For example, the recent spike to $ 13,800 is similar to the decline seen after the 2017 bull run. However, the sharp decline (purple zone) took place shortly after the price broke. Fib-0.5 level. It should be noted that past results do not indicate or predict future price actions.
However, if a similar decline occurs, the price can easily reach $ 8,212 or drop a wick to $ 7,667.
The Bitcoin miner and their status
Source: ByteTree
The first is a metric that tracks the number of coins moving from miner's wallets during that time period. This metric is usually triggered when miners give up. The last time this happened in November 2018, Bitcoin was below its fair price and dip lower.
This figure has started to increase sharply in 2020.
Conclude
A break below the Fib-0.5 ($ 8,461) will be very serious. While this is unlikely, it should be noted that BTC has been stuck between the two trend lines since 2017. Since the price has reached the top of this structure, it is only safe to assume that the price will touch or at least move. transfer near the other end ($ 7,667).
This will cause miners to give up as witnessed at the end of 2019.
It is too early to discuss breakout from this model. However, when the price is close to the top of the model, depending on the conditions at the time, the breakout direction is predictable.
For now, it is better to wait for volatility to appear than be stuck in medium or short term transactions.
You can see the price of Bitcoin here.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
Thuy Ngan
According to Ambcrypto
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