Daily Report – Bitcoin and Market Update (April 25 2022)

By Cryptobirb

HTF 1W:

The weekly chart closed at around new lows after a fake breakout during the intraweek session.

BTC keeps trading below the descending 50-week average, which implies overall long-term trend has decreased its mean reference price from $48300 to $44700. While the slope is not aggressive to the downwards it’s been relatively stable, which confirms the downwards average tendency.

Accounting the higher highs and higher lows made by BTC over the last year and a half, I’d read this as an overall long-term retracement, rather than a bear market. Naturally, the deviations against the 50-week mean were outstanding and it’s apparent the price of bitcoin has started to converge more around the average itself. It may be considered a sign of contracting volatility.

An ascending channel chart pattern is seen in the chart and puts bitcoin in danger of more downside risk. A measured move following a downwards breakout would place bitcoin sell-off targets around $25000. While this is not necessarily the most likely forecast in my eyes, one needs to account for an overall difficult situation in traditional markets with stocks plummeting, as well as the inverted yield curve event signaling the upcoming recession in next months.

All that said, bitcoin keeps trading inside the $28800-$69000 chart pattern with no follow-through to either side, which makes it more neutral than bearish, the way I see it.

HTF 1D:

The daily chart displays an overlay of 200-day (dotted orange) and 50-day averages (black curve).

An increasing distance between the averages past the bearish crossover from January 2022 suggests an increasing medium to long-term momentum to the downside.

However, both averages are relatively flat over the course of the past few months. Hence, I would approach any technical indicators, signals, readings with a grain of salt, as the sideways periods include more misleading noise than actual trends, triggering frequent fake/noise signals.

Regardless of that, BTC has been trading inside a local ascending channel anchored at the lows of $33000 and the highs of $48000.

After rejecting the $48000 highs, this enhanced the technical significance of the 44.6-47.6k USD resistance region defined by the moving averages. As a result, I would be very cautious with over exposing to risk on assets, trades for as long as bitcoin does not reclaim the territory over the $48500.

Until that happens, crypto is in quite a defensive environment.

HTF 12H:

The daily chart displays an overlay of 200-day (dotted orange) and 50-day averages (black curve). An increasing distance between the averages past the bearish crossover from January 2022 suggests an increasing medium to long-term momentum to the downside. However, both averages are relatively flat over the course of the past few months. Hence, I would approach any technical indicators, signals, readings with a grain of salt, as the sideways periods include more misleading noise than actual trends, triggering frequent fake/noise signals. Regardless of that, BTC has been trading inside a local ascending channel anchored at the lows of $33000 and the highs of $48000. After rejecting the $48000 highs, this enhanced the technical significance of the 44.6-47.6k USD resistance region defined by the moving averages. As a result, I would be very cautious with over exposing to risk on assets, trades for as long as bitcoin does not reclaim the territory over the $48500. Until that happens, crypto is in quite a defensive environment.

MTF 4H:

The MTF chart shows local indecision with fakeout at the bottom, as of now.

Clearly, the CTF Trailer remains to give more credit to the sellers for as long as BTC trades below the Stop invalidation level of $40382. The bears maintain the upper vote in the short-term market perspective.

After marking out 73% strong divergence over the recent sessions, bitcoin has tagger the lows at $38200 and reverted slightly back above the broken support, committing to the short-term fake breakout setup.

Failed patterns tend to perform better than the regular breakouts, so, theoretically, bitcoin could be due for local upside pullback towards the 39000-40000 USD region. The fakeout setup is not always indicative of a true bottom.

However, the caution is still advised, as equities’ post open price action may influence bitcoin accordingly, dragging the price of bitcoin around in the same direction due to their strong correlation.

LTF 1H:

In the hourly chart, bitcoin remains to present more bearish advantage over the bulls rather than the other way around.

This can be seen as the downwards sloping CTF Trailer with a current stop invalidation at $39328. This is the main level required for the bulls to reclaim, in order to re-gain the control over the market on the intraday basis for the next few days.

If bitcoin fails to achieve that, there’s downside risk and the danger of decline in the mid 30000s USD levels remains.

FEAR/GREED INDEX:

Following my quote that “The main premise to the contrary opinion investing remains that the crowds are always wrong at the extremes due to their perception biases – cognitive biases, or mainly – emotional biases, e.g. loss aversion bias, sunk cost bias which make them act irrationally.”, one can induct that the 23 points on th scale confirm bearish expectations from the speculators. The more extreme pessimism there is within the market, the more buying opportunities.

It’s not a timing indicator, so it’s pointless to expect specific time in the market to enter or exit based on that. However, it is a valuable source of information regarding an overall consensus and environment of trades.

Again, it does seem a bit “late” to sell off at current levels, as the market values bitcoin as “cheap” based on the historical records, but also it seems a bit “early” to enter.

No man’s land continues. Do not over trade.

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God bless!

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