Daily Report – Bitcoin and Market Update (February 2 2022)

By Cryptobirb

HTF 12H:

The middaily chart shows a slow-pacing upwards trend ever since bitcoin bounced off 33000 USD lows. An upwards trend is defined as a sequence of higher highs and higher lows in the price chart. What does the low momentum mean in practice for bitcoin? Let’s break it down.

First off, the presence of numerous upper candle shadows reveals the supply side of the market and areas defined by the sellers and where the buyers failed. Notice that most of the candle closes over 38000 USD level have been equipped with either small candle bodies or significant upper wicks. This is what lack of momentum means shown in the price chart. It means that the buyers struggle over the short-term time frames. Despite the chart technically keeps making higher highs and higher lows, one can tell it’s not full of strength as it barely makes it, to put it this way.

BWAP support is given at 35.8-36.5k USD region and as long as bitcoin prints 12h candle closes above this zone, the technical upwards trend is relatively “safe”.

BPRO Momentum Bands define the actual volatility of bitcoin for the days ahead to be mainly concentrated between 35.8k USD and 40.5k USD levels.

CTF Trailer Stop is set at 40365 USD as the most critical level for this soon-to-be a 3 month correction. A proper break above this level with a follow through (new higher daily close) should officially be enough to reverse the market to the upside.

MTF 4H:

MTF chart shows a local intraday volatility breakout to the downside.

The main CTF Trailer Stop level 37255 USD is the main defense level that bulls need to hold. Otherwise, if a bearish close below, BTCUSD may be aiming the Low Momentum Band zone at the 35.8-36.5k USD area.

Level Line support is given at 36208 USD and it provides confluence for the said band support area. It means then, that if BTCUSD closes a 4H candle below the CTF Trailer Stop level, the next target to the downside seems to be $36208 abouts.

The High Momentum Band implies volatility-based supply zone where the sellers may aggregate their ask orders, accounting the average volatility of bitcoin.

The resistances are given higher above by the BPRO at [USD]: 38678, 41376 – for the most relevant figures now.

LTF 1H:

The hourly chart shows a local rejection at the top area off of a supply zone given by the price action around 39000 USD level.

BPRO analysis of bitcoin’s price action suggests that the main support area for now is defined at the key pivotal level (the orange thicker line) at 36900 USD. As long as this one holds, BTCUSD could be expected to continue trading inside the range bound movement between 36900 USD lows and 38700 USD resistance – unless a proper break beneath the said support occurs.

The resistances defined by the price action of bitcoin are given as follows:

39300
38800
38260

BPRO Level Lines show supports at:

36900
36200
35500

These levels could be anticipated to serve as level-to-level references. In other words, when one level is breached, the next one in the direction of the movement can be expected to act as the next “magnet”

FEAR/GREED INDEX

The fear saga continues with yet another day.

At 28 points on the scale, it adds another day to already 2.5month-long lasting correction.

As mentioned on Monday, I still maintain the point that bitcoin is in a wide re-accumulation range, soon to be followed be an upwards impulse – regardless if there is one more dip ahead or not.

Remember that the majority is usually right in the middle of trends and usually wrong about the extremes. At times one needs to wait longer than preferred for a bitcoin bottom to form, but the history suggests every time bitcoin was this oversold, it was followed by a proper bounce and profitability soon after.

It’s not a timing indicator, though. Do not expect it to give a perfect timing for bottom or top in the market. Instead, it may be source of valuable insights to decide when the market is to be considered “cheap” or “expensive”.

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