Technical Analysis
Table of Contents
Bitcoin
4-Hour Time Frame
After retesting the critical point at $24k four days ago, the price has found Resistance, as expected. The question is: is $24k just a local top or significant Resistance for the price in the short term?
The answer is at the $20.8k range (fight point), as the price has been accumulating in this range ($22.4k-$19k) for approximately 41 days.
While the price holds above $20.8k, testing it as Support, the highest probability is the breakout above the vital point; that is, $24k would only be a temporary local top. In the concise term, the new Resistance could anticipate a retest of the fight point in the red line at $22.4k. If it is not broken and set as Support, the target for the next few days is $20.8k.
We can define the next move from the price action at $20.8k. Watch out for the current range of $22.4k-$20.8k as it could become Resistance. If this happens, it deconfigures the current probability, and the continuation of the downtrend could become a reality shortly.
S&P 500 Index
4-Hour Time Frame
SPX completed the two fundamental channel advances after marking the Main Top at around 4,750. When the behavioral pattern of a price trend changes, there will be marked points demonstrating price movement contrary to what had been happening.
The test at 4,631 as Price Resistance for 2x successfully signaled the price’s attempt to regain the uptrend; however, it was rejected as a lower top than the previous one, clearly configuring that the pattern has changed to bearish.
The confirmation point was 50% of this same channel (1 channel below the main top) at around 4,500, showing another beautiful rejection. That said, the price went slightly beyond the downtrend target, marking lows at the bottom of the channel at 3,669. Note that the significant top price has stopped near 50%.
From here on, there is a high probability for the price to make a new pattern change and return to uptrend, as the price moved the same magnitude during the attempted resumption of the uptrend pattern near the last top.
When a pattern is broken, most people don’t believe it until the price moves in the opposite direction. After moving to the opposite side of the pattern, most people believe that the price will continue to move to that side. This is when the price reverses again, so most people lose money on these moves, and few gain money.
One must always be one step ahead of the market even if one doesn’t know its next direction. This is where probability comes in and the main price regions that can anticipate the next move. The advance of 2 full channels is the accurate projection of the trap near the top that made most people believe that the pattern has not changed, that is, a full SUBCYCLE. When a full sub-cycle is realized, the current price pattern tends to be reversed; the deeper it goes, the more likely it is.
Confirming that the behavioral pattern in price has changed the region of 4,029-4,149 will be the Major Support for the price to have the strength to break the upper channel (4,268-4,390) and move into the new pattern, in this case, uptrend realizing higher tops and higher bottoms.
Onchain Analysis
MVRV
Since the break of the Price Support at $30k, MVRV with MA30days has entered the Accumulation Zone providing an excellent region to buy and hold BTC for the next bullish cycle. Currently, the indicator is near the values reached during the bear markets of 2018/2019 or 2015/2016.
At least 61 days in which the indicator is within the Accumulation Zone. Relative to the historical average in which the MVRV remains to provide that same opportunity to accumulate was 600 days in 2015/2016 and 300 days in 2018/2019.
In the current cycle, there is space for the indicator to continue within the Accumulation Zone for more time than in the past.
Therefore, the selling pressure is decreasing, coming close to exhaustion from the MVRV 30d reading, since when the realized capitalization outpaces the market capitalization meaning, there is decreasing motive to Distribute, that is, an opportunity for Accumulation.
