Introduction
Bitcoin price is struggling to hold above $40.04K as buyers continue to work to overcome the $40,046 resistance. The current uptrend has reached bullish exhaustion as a result. However, it is still possible for the price to rally above the $43,000 high, extending the bullish momentum toward $45,000. If buyers cannot sustain their bid, BTC/USD may continue to drop to the $37,633 support level. If you are planning to mine Bitcoin, there are considerations for purchasing bitcoins.
Bitcoin price is crossing above the 9-day and 21-day moving averages at $39,723
Bitcoin’s price has been incredibly volatile. It has fluctuated from less than $20,000 to more than $60,000 over the past year and has suffered significant losses. A recent government ban in China has lowered the price by more than 50 percent, but it has recouped those losses in October and is on track to hit an all-time high of $68,789 by Nov. 10, 2021. It’s a decentralized currency, meaning it doesn’t belong to any one country.
Recent events have created extra volatility in the stock and cryptocurrency markets, which is expected during times of uncertainty. But as we enter a new uptrend, we need to remain patient. The market is likely to continue to experience ups and downs. However, investors shouldn’t react too strongly to those fluctuations, as they may just lead to the wrong investment decision.
When trading cryptocurrencies, it’s vital to understand the cyclical behavioral pattern of the market. While the moving average provides helpful information, it’s often too late to act on its signals. In this case, investors need to use other technical indicators to make better decisions.
This bearish view is still in play, but the bulls need to push the price above the 20-day EMA to break through this support. A break below this level could result in a return to the downtrend. Bears will attempt to sink the pair below the $26 support if this happens. Alternatively, a breakout of this level could clear the way for a rally to the top of the trendline at $10.
Bitcoin is trading below the 9-day moving average at $37,633
Moving averages are an essential tool for identifying undervalued and overvalued markets. They also indicate the direction of cyclical trends. Historically, when Bitcoin price falls below a moving average, it signals the lows of a bear cycle. Conversely, when Bitcoin price rises above the moving average x5, it signals the top of a bull cycle and is a good time for long-term investors to de-risk their positions.
As the price of Bitcoin continues to drop below the 9-day MA, it will be difficult to predict its future direction. However, it has risen from this low several times, creating a bullish cross on a 1D chart. A bullish breakout is unlikely until the price breaks above the 200-week MA.
Bitcoin is trading below the 21-day moving average at $39,723
The simple moving average (SMA) is a technical analysis tool that measures the movement of a price over time. The SMA considers the price movement of a given asset and shows it as a dynamic line. The SMA adjusts its position when a new candle is formed.
For several reasons, Bitcoin is currently trading below its 21-day moving average at $39723. First of all, it has spent most of its time above it. When it revisits the MA, it typically bounces significantly. This could mean that a bearish trend is about to start.
Secondly, it exhibits a crossover pattern between two simple moving averages. This crossover can be bullish or bearish and occurs when the faster or slower-moving averages cross. This crossover signal has been formed because of a sudden rise or decline in price.
Another reason Bitcoin is trading below the 21-day moving average at $39723 is that the price of the cryptocurrency is below the 21-day moving average. A moving average is based on the average cost of a security or a contact over a certain period. The 21-day moving average takes the last twenty days of price data and smooths them out.
Conclusion
Bitcoin price is testing the upper boundary of a long-term channel, and it is trading above the 9-day and 21-day moving averages. If it breaks through this barrier, it may continue its advance to higher levels. Traders may be looking to identify potential resistance levels near $44,000, $46,000, or $48,000. They may also use moving averages to gauge the trend’s strength.
Bitcoin is still a global asset. Since it started at less than a cent per coin, the price has risen thousands of percent. Bitcoin prices are volatile, however, and can vary widely between countries. As a result, it is essential to note that the BTC price will not hold above $40.04K for too long.
