This article is reprinted with permission from Bitpush, author: Cody Feng, copyright belongs to the original author.
This week opened at 117,465 points, reached a high of 117,622 points on Monday, and a low of 110,671 points on Sunday, ultimately closing at 113,478 points, with a weekly decline of 3.41%, a maximum fluctuation of 6.28%, and a transaction amount of 13.499 billion USD. This week ended with a large bearish candle, with the price closing below the 5-week moving average.
Bitcoin Weekly K-line Chart: (Momentum Quantitative Model + Sentiment Quantitative Model)
Bitcoin Daily K-line Chart:
In the last weekly review, I predicted that Bitcoin would primarily trend downwards with fluctuations this week, with technical rebounds occurring at support levels. The first resistance level above is around 120,250 points, with strong resistance between 122,000 and 123,218 points; when adjusting downwards, the first support level is around 114,200 points, with strong support between 111,980 and 110,530 points. The probability of retesting the strong support area next week is very high, so pay close attention to this position.
In the last weekly review, I provided the following operational strategy: maintain a mid-line position of about 30%, hold cash and wait for a clear mid-line direction before taking action. Short-term operational strategies:
Short near 117,400 points, with a stop-loss at 118,600 points;
Near 114,200 points, sell half of the previous short position and move the stop-loss to 117,000 points;
When a bottom signal is seen near 111,920 points, clear the remaining short position.
Review of Actual Market Performance This Week:
On Monday, Bitcoin opened at 117,465 points, experienced a slight upward rebound, then fluctuated downwards, hitting around 114,706 points where it found support and began to rebound, closing with a 1.04% decline and a lower shadow;
On Tuesday, the price continued to adjust downwards, with the decline gradually increasing, closing with a 2.92% drop and a medium bearish candle;
On Wednesday, the price stopped falling around 112,353 points, then began a technical rebound, closing with a 1.23% increase and a bullish candle;
On Thursday, the price continued to decline, completely "swallowing" the previous day's bullish candle, closing with a 1.57% drop and a bearish candle;
On Friday, after opening, it fluctuated around 111,900 points. Around 10 AM, due to favorable market news, the price quickly surged to around 117,000 points before starting to fluctuate narrowly, closing with a 3.93% increase and a larger trading volume than the previous days.
On Saturday, the price adjusted and stabilized at 114,536 points, closing with a 1.28% decline and a bearish candle;
On Sunday, for most of the time, it fluctuated around 114,700 points. Around 3 PM, the market quickly dropped again, retesting the lower edge of the strong support area, falling to 110,671 points before rebounding, closing with a 1.66% decline and a lower shadow.
From the market perspective, the low points generated during the downward adjustments on Monday and Saturday, and the high points generated on Wednesday and Thursday, are all near 114,700 points, which is very close to the support level of 114,200 points I provided; the low points on Thursday, Friday, and Sunday are all near the strong support area of 111,900 to 110,530 points I provided. At the same time, all short-term operational plans given last week have been profitable. It can be said that the two important support levels and short-term operational strategies highlighted last week have all been validated by the market, and Bitcoin's performance aligns with my predictions from last week.
Next, I will analyze the changes in Bitcoin's internal structure after this week's operation based on multi-period technical indicators.
As shown in Figure 1, from the weekly chart:
Momentum Quantitative Model: Continues to issue high-level dull signals, with Momentum Line 1 starting to decline, gradually approaching Momentum Line 2, and the volume (red) bars have shortened compared to last week.
The model indicates a high index for price decline.
Sentiment Quantitative Model: Both sentiment indicators are at 0, with a peak value of 0.67.
The model indicates a high index for price decline.
Digital Monitoring Model: No digital signals are currently displayed.
The above data indicates that the weekly level is in an adjustment process, focusing on when the momentum top divergence will form.
As shown in Figure 2, from the daily chart analysis:
Momentum Quantitative Model: A momentum top divergence formed on Monday at the daily level, and after Friday's close, Momentum Line 1 has crossed below the zero axis, with Momentum Line 2 about to cross below the zero axis, indicating that the market is about to enter a bearish trend.
The model indicates a high coefficient for price decline.
Sentiment Quantitative Model: On Friday, both sentiment indicators fell from high levels.
In terms of volume: Daily trading volume has not shown significant changes.
The above data suggests that a momentum top divergence has formed at the daily level, and the price is about to enter a bearish market.
Focus on the gains and losses at 114,700 points. If it breaks upwards, the price increase space is limited, and after encountering resistance, it will adjust downwards; if it effectively breaks down, the price will continue to fluctuate downwards.
Resistance levels: The first resistance level is around 114,700 points, the second resistance level is around 117,400 points, and strong resistance is around 119,000 points.
Support levels: The first support level is between 111,980 and 110,530 points (if the support is effective, it will maintain a weak fluctuation structure; if it effectively breaks down, the price decline will increase); the second support level is around 105,300 points; strong support is around 98,000 points.
Mid-line position: Currently, the mid-line position is about 30%; if the price breaks the bullish-bearish channel, all long positions held mid-line will be sold, holding cash and waiting for a clear mid-line direction before taking action.
Short-line position: Set stop-loss points and primarily short at highs. (Using 1 hour as the operational cycle)
Short near the opening price, with a stop-loss at 114,900 points;
Near 110,530 points, when a bottom signal is seen, sell half of the held short position, setting the take-profit at 112,500 points;
If the price effectively breaks below 110,530 points, it is recommended to buy back the previously sold short position near this point, setting the take-profit at 111,500 points.
If the above operations are successful, wait for the price to drop to around 105,300 points, and when a bottom signal is seen, sell all held short positions.
Related: Recent sell-offs of Bitcoin (BTC) and Ethereum (ETH) have led cryptocurrency ETPs to record their largest losses since March, with capital outflows of 1.43 billion USD.
Original article: “BTC Weekly Watch: Is a Bear Market Coming?!”
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