Bitcoin technical analysis offers a potential bottom for BTC price with the upcoming “golden cross”. However, some key Bitcoin price levels need to be broken before the uptrend begins. Now, veteran analyst Michael van de Poppe has touched on this. We examine it under 4 headings…
How did the fake Litecoin news affect the market?
Bitcoin (BTC) and the cryptocurrency market have been hit hard this week as the fake news surrounding Litecoin (LTC) has taken a hit. However, the structure of its market has not changed. In fact, Bitcoin’s price may be bottoming out, according to analyst Michael van de Poppe, as a golden cross is starting to form. Besides, foreign exchange reserves are reaching record lows, a signal of great strength, suggesting that most investors are buying their Bitcoins from exchanges, reducing the overall supply that can be sold in the market.
Could Bitcoin explode due to golden cross?
According to Poppe, the daily chart for BTC/USD shows a few important things. The first and most important of these is the potential that is about to be realized. is the golden cross. During the summer, this pattern was the main focus as the weather turned extremely negative and many traders were expecting further declines as a result. However, the market is in an uptrend as the MAs golden cross is a very lagging indicator. However, even if the golden cross occurs, it does not automatically mean that the market will continue in this direction.
Right now, a golden cross is a bullish signal, especially when Bitcoin’s price is ready to break above the MAs. If this happens and Bitcoin’s price rises above these MAs, these levels could serve as new support for a larger rally.
Things to watch on the daily BTC chart:
A week ago, the market saw a heavy correction as the Bitcoin (BTC) price dropped from $52,000 to $42,000. However, Bitcoin price dropped to a nice support level, resulting in a long wick. Such a long wick means buying pressure and a new level of support. As Poppe previously noted, another volatile move has taken place in the past few days, with fake news of Litecoin partnering with Walmart. This initially caused a big splash, followed by a major fix.
The best thing to do during such a volatile move is to stay away and check the markets on higher timeframes as these are often an indication of critical levels to watch. According to the analyst, these critical levels to watch are still between $42,800 and $44,000. As long as this zone holds support, it is likely to continue upwards. In other words, the downtrend was played with heavy correction, but the worst may be over if the markets stay above $42,800-44,000, according to Poppe.
Therefore, the fake Litecoin news caused some volatility, but the critical support between $42,800 and $44,000 was retained and this can be considered the critical outcome here. Now, first on the upside, bitcoin price must surpass $47,000 as current resistance. If that fails, we could continue upwards towards $50,000 as the final hurdle before a potential ATH test.
Total crypto market cap holding significant support
The overall market cap of the cryptocurrency market shows that significant support remains here. As long as the total market capitalization remains above $2 trillion, it is more likely to rise to the ATH level. The minor difference in Bitcoin price here is that the total market cap has tested the ATH region. As the aggregate market cap tests the all-time high once again, the probability of a breakout increases. However, most likely, crypto’s overall market cap will hit new all-time highs faster than Bitcoin, as altcoins have outperformed Bitcoin lately.
Bull divergence and falling wedge formation in Bitcoin BTC)
The four-hour chart for Bitcoin shows a potential falling wedge structure that is likely to break to the upside. The critical level to break on the upside is the $47,000 resistance as it has acted as a heavy resistance since the last correction. Once the price of Bitcoin breaks above this level, it is very likely to continue to $50,500 as the previous correction was made very vertically, as there are not many levels for the price to reject.
Finally, this is not a guarantee that the price of Bitcoin will break to the upside. Overall, if the price of Bitcoin can form an HL around the $45,000 region, this bullish divergence will be confirmed and then a breakout towards $47,000 could occur. This remains strong resistance to breakage. On the downside, the most important support to hold is the area between $42,800 and $44,000. If this support fails, the $38,500-40,000 level should be the next area of focus.
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