Bitcoin upcoming monthly close will be crucial

Bitcoin upcoming monthly close will be crucial

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Bitcoin continues to trade within its range, seemingly unperturbed by an upcoming monthly close that could decide the next few months for the king of the cryptocurrencies.

Bitcoin operates best in high liquidity environment

The range between around $70,000 down to $60,000 has been containing the bitcoin price since mid-March. Seemingly unconcerned with world geopolitical events, deteriorating economic data, and the like, bitcoin is travelling sideways with investors and traders uncertain of what could be its ultimate direction.

Each time the US Federal Reserve puts out statements that it is likely to cut interest rates, inflation data comes in that suggests that the Fed will keep rates higher for longer. 

Bitcoin operates at its best in a lower rates and higher liquidity kind of environment, and as things stand this is just not the case. Not yet anyway. The next release of CPI data on 15 May will be very interesting to see.

Will bitcoin fall out of its bull flag?

Source: Coingecko/TradingView

Therefore, bitcoin traverses sideways while it waits for the impetus and momentum that will push it one way or the other. If this is to the downside and bitcoin falls out of the bottom of its bull flag, and breaks through the support at $59,000, a plunge down to $51,000 would likely be the next move.

Much higher time frame looks positive for $BTC

Source: Coingecko/TradingView

That said, it’s really on the much higher time frames that things become clearer for bitcoin. Where the monthly chart has the $BTC price needing to hold $61,000, and the 2-month chart shows a really long wick to the upside, suggesting that price is being forced down, the 3-month chart looks as clear as a bell.

The wick down to confirm the level of the candle tops in 2021 looks very bullish. As long as price stays above this level for the next two months it would suggest that the subsequent three months should be a green candle. Momentum is also coming in from the stochastic RSI.

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.

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