BTC/USD, Technical Outlook, Edition #135 (27/10/2021)
Bitcoin kisses the daily 20 EMA 😳 Dominance fails to close at new highs but Altcoins aren't out of the woods yet! Gain the latest intel from Qluster HQ in tonight's free report 👇
It was a magical moment, just the way Bitcoin had imagined…
After nearly two weeks of flirting around support, Bitcoin finally musters up the courage to kiss the 20-day Exponential Moving Average (D1 20 EMA, GREEN).
Bitcoin, BTC/USD - Daily (D1)
Underestimate the significance of this short-term exponential moving average at one's peril.
In the case of Bitcoin, some claim the EMA is much akin to Fibonacci retracements - i.e. a self-fulfilling prophecy, beholden to the individual.
As such, Q scrutinises a breakdown of the relationship…
Bitcoin typically follows a rising trend when buyers hold above the D1 20 EMA - while riding the upward slope as supportive momentum.
Conversely, Bitcoin tends to correct or reverse into a downtrend when bears succeed in driving the price to break and close below the D1 20 EMA.
Et voilà !
The negative slope of the EMA acts as resistance - until price action can break and hold above…
Did you miss Q's explanation of this special relationship?
Read the full article 👇
Bitcoin, BTC/USD - 4 Hour (H4)
Qluster analysts conclude with a closer inspection of the H4 BTC/USD chart.
A technical assessment reveals latent potential for another wave down should bulls fail to reclaim support at USD 60 – 61K.
Bitcoin Dominance, BTC.D - 4 Hour (H4)
The Bitcoin Dominance chart depicts a hard bounce from 44.08% of the total market cap - the 0.5 fib retracement zone.
Q notes that bulls have yet to generate a higher high.
Thus, altcoins may be safe should hindsight reveal this was just a dominance play to shake out weak hands.
Q's Conclusion
Bitcoin buyers must hold the D1 20 EMA.
"All things come to those who wait."
Technical principles suggest price action may need several days to work through consolidation.
But, be forewarned.
Q interprets a meltdown from here to be remarkably bearish and perhaps even more so for Altcoins.
On the other hand, Altcoin season will likely continue its spring to life - should BTC.D pull back while BTC/USD holds the D1 20 EMA.
See you again for the next update.
- q
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