Bitcoin’s volatility is pretty familiar among its investors and enthusiasts. BTC has seen its highs and lows, wiped millions of dollars off its investors, got several traders ‘rekt‘, all in a matter of few weeks.
The abrupt price movements of Bitcoin has more than one definite reason:
- Macroeconomic instability arising out of the current Coronavirus pandemic.
- Market manipulators seem to be quite active lately. They swing Bitcoin prices for profit booking.
- Finally, Bitcoin halving is going to take place in less than one month, and that has historically proven to swing prices in either direction.
Trade setup for BTC, be prepared for a big decline
- This daily chart is set up specifically for highlighting the particular trading opportunities existing at different price points.
- The two inclined trend lines join the highs and the lows. It can be observed that the line joining the lows is much steeper than the line joining the highs. Bitcoin is set to exit from this rising wedge pattern very soon.
- Exiting from the rising wedge presents two possible scenarios: an upward movement or a downward movement for BTC. Considering the current volume, Bitcoin could drop all the way to $4,111. The drop is likely to happen because there does not exist any reliable support zone in between.
- The other scenario could be Bitcoin making a move up, which is less likely as of now but cannot be ruled out. In that case, Bitcoin would face stiff resistance at $7498.14. BTC has tested this resistance number of times in the past and rebounded.
- In case Bitcoin succeeds in breaking past the resistance, there could be upside potential to $8,937. Traders would most definitely love that price movement. However, the current economic conditions could be a deterrent to this movement by the BTC.
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