March 28, 2019

Weekly Technical Analysis

We believe that the primary trend continues upwards. As of the time of this research report (Mar 26, 2019), BTC/USD was trading at $3,950, representing a 3.6% decline week-over-week. To our opinion, this decline primarily represents the short-term volatility, and do not indicate a trend reversal. The price is expected to rebound upwards from the lower trendline of an ascending trend channel, which provides the best approximation of the medium-term trend for BTC/USD and is the primary trend indicator we are relying on in this analysis. 

If you’d like to get more details on the current BTC/USD price trend, please continue reading this report.

The primary trend for BTC/USD

The primary medium-term trend is upward. Although we see that the price has transitioned into a short-term downward correction on Monday, Mar 25, when it moved below $4,000, we do not expect this correction to persist for a long time.

Based on the chart patterns analysis, presented above, we see that there is a strong continuation chart pattern, namely, an ascending trend channel. Importantly, the market price has almost approached the lower trendline of this trend channel, and we're expecting that the buying demand will resume over the short-term. The resumption of the buying activity is expected to create new momentum upwards and reinforce the medium-term upward trend, as presented on the chart. Although there is still enough room for the price to continue declining towards the support level at $3,800, we do not believe it is a highly probable scenario, based on what we see from the trend analysis and the existing chart patterns.

Significant resistance at $4,250

Based on what we see from the historical trend analysis, the nearest significant resistance level is located at $4,250. This level is considered to be significant, because, each time when the price approached $4,250 over the past four months, traders stepped in to sell with enough volume to end a rally underway at that time. 

At the same time, we’re seeing that over the same four-month period, buyers were getting more and more bullish and were stepping in at increasingly higher prices to halt sell-offs instead of waiting for further price declines. The presence of a such a 'constant' resistance level at $4,250 and an ever increasing support level represents an ascending triangle chart pattern and implies that the BTC/USD is in an uptrend.

This also means that if (or when) the price breaks through, and above the $4,250 resistance level, the ensuing move is projected to be significant and volatile. Therefore, we recommend using $4,250 as a level for take-profit orders in long positions.

Significant support at $3,800

Based on what we see from the historical trend analysis, the nearest significant support level is located at $3,800. This level has been tested by the market on two occasions recently and marked a short-term trend reversal upwards on Feb 18, 2019. In case the price breaks through and below the $3,800 support level, it is expected to continue declining further downwards, and the breakout itself is expected to be volatile. 

We recommend using stop-loss orders for long positions located at or slightly below the $3,800 support level.

We hope this analysis was useful to you. If you have any feedback or suggestions, please contact us at [email protected].

To your trading success,

Research Team at Monfex

 

Disclaimer

This report does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instruments. Monfex accepts no responsibility for any consequences resulting from the use of this material. No representation or warranty is given as to the accuracy, timeliness, or completeness of this information. Consequently, any person acting on it does so entirely at their own risk. This research and analysis does not involve or apply to any specific investment objectives, financial situation, and needs of a specific person who may receive it.

This report is for information purposes only and should not be considered a solicitation to buy or sell any cryptocurrency or cryptocurrency product. It has not been prepared in accordance with legal requirements designed to promote the independence of research, and as such it is considered to be marketing communication. Redistribution is prohibited without written permission. To license this report, please contact [email protected]

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