Technical Analysis | New Dimension 2021/03/20 BTC

TA TESTING is currently a market analyst collaborating with Binance in the Taiwan market, focusing on the analysis of the U.S. stock market and the cryptocurrency market. With professional insights and expertise, TA TESTING will regularly share case studies or strategies about the cryptocurrency market in the New Dimension column in the future, providing the community with a healthy channel to understand the cryptocurrency market and learn market analysis.

Both the short-term and daily charts have turned bullish, and the next 5 days starting from today will be the best opportunity for the bulls to attack.

Background

"New Dimension | 2021/03/17 BTC Daily Moving Average Convergence"：

"Therefore, the conclusion drawn from the convergence of the daily moving averages is: it will take another three days before there is upward momentum.

What is the current situation of the daily chart?

The daily chart is currently attempting to retest the previous high on 2021/03/13, failing and retracing back to the daily moving average consolidation zone. Although not clear, it is still considered a consolidation on the daily chart.

Currently, the 4-hour chart trending above the MA25 turning stronger can be understood as an upward trend within the daily chart consolidation, so the focus going forward is whether this 4-hour upward trend can extend into a larger trend, namely the daily chart upward trend."

Since the last post, the price of BTC has been maintaining short-term consolidation above the 4-hour MA25 (purple line in the image below), successfully passing the "another three days" mentioned in "New Dimension | 2021/03/17 BTC Daily Moving Average Convergence".

BTC 4H

• Point a: Initiating the convergence of ten low closing prices will further push up the 4-hour MA25. According to recent interactions between moving averages and prices, the 4-hour MA25 represents the short-term trend, so the price will be influenced by the momentum of the moving average.
• Point b: Over the past 16 hours (4 4-hour candlesticks), it can be seen that all have been closing at low levels, which has caused the moving average to turn from a downtrend to an uptrend.
• If there is an upward trend, pay attention to point c whether the trading volume is increasing. If there is no increase, it may be necessary to set tighter trailing stop losses, as there has been a contraction in volume for a while, and continuing to make new highs with low volume could likely indicate the last stand of the bulls.

BTC 1D

Why start by saying "the next five days starting today are the best opportunity for the bulls to attack"?

Because starting today, point d within the white box will eliminate the 6 consecutive lower closing prices one by one, accelerating the rise of the moving average, thus gradually strengthening the upward momentum.

However, starting from point e within the white box will begin to converge the rising lower closing prices, which will decelerate the rise of the moving average. Although the moving average will continue to rise, the upward trend will gradually weaken over these 8 days. If the price does not significantly rise at this point, it is unfavorable for the bulls.

It is also worth noting that the current price can be seen as consolidating at the upper boundary of the range, which is generally favorable for the bulls. Additionally, since it is a consolidation, volume contraction at this time is not a concern. However, when the consolidation ends and a direction is chosen, it is advisable to have increased volume to stabilize the trend; otherwise, the trend may become unstable.

This is a position where both the short-term and daily charts are beginning to strengthen. If the bulls cannot take advantage at this point, it could be problematic.

This article is for educational purposes only and does not constitute investment advice.

Cryptocurrencies are highly volatile markets, please invest cautiously. Personal subjective opinions, not suitable for everyone, are for reference only and not for trading advice.

All analysis is based on the current market situation and does not predict future market changes; the editor's work is a hobby and does not track all subsequent developments. It is recommended to maintain operational flexibility and adaptability.

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