BTC/USD, ETH/USD, ETH/BTC, Technical Outlook, Edition #60 (23/07/21)

Bulls continue pushing to the upside, however, buyers are still cautious at these levels, with shorts continuously piling up as the market chops sideways. Have bears tricked bulls into a trap?

Bitcoin stalls at key resistance, 32.5K USD, and is now attempting to flip the .618 Fibonacci retracement zone.

Bitcoin, BTC/USD - 4 Hour (H4)

Using the H4 BTC/USD chart above, we can see that the .618 fib retracement is a very messy pivot zone due to buyers and sellers hedging their bets around the golden ratio.

Combined with the horizontal resistance shaded in red, Bitcoin demonstrates why this zone is critical to sparking a bullish reversal.

Conversely, if the bears managed to sell down lower than USD 31K, this most recent bounce was indeed a bull trap. Therefore, one can only assume that capitulation may be on the cards if bulls receive another nail in the coffin.

Ethereum, ETH/USD - 4 Hour (H4)

We extend this focus to the ETH/USD trading pair. Structurally speaking, it looks to be lagging BTC/USD and a little more promising for a leg up to USD 2150.

Ethereum, ETH/BTC - 4 Hour (H4)

Furthermore, ETH/BTC approaches the .618 fib retracement zone at 0.06482/BTC, which marries up to 2150 USD on ETH/USD.

Q’s Conclusion

The bulls are defending the line against bears, and Bitcoin is again trading within a tight range. Will a decisive close above key levels be forced in by bulls, or are bears simply creating a bull-trap, pulling in more liquidity to create a stronger push to the downside? In these situations, it’s best to hedge positions and wait for the market to decide on a direction.

See you again for the next update.

- q

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