Daily Report – Bitcoin and Market Update (March 12 2022)

HTF 12H:

The middaily chart continues to show a sequence of almost random oscillations around a technical “gravity” center at 39000 USD. As bitcoin keeps chopping around this level, it seems to be lacking an overall direction consensus from the market participants.

The price action of bitcoin shows a contracting consolidation, as the highs and lows seem to be converging towards an invisible apex. This may suggest that after a relatively calm and “boring” sequence of candlesticks, the traders may see a more explosive movement coming up relatively soon. This stems from the market’s tendency to “breathe” or pulsate, where after low volatility periods, new greater volatility tends to follow. Increased volatility implies increased risk, so it may be worth to keep the overall risk or capital exposure low.

The CTF Trailer suggests that the main invalidation level for the bearish thesis is at $42422 as of now. A strong daily close above this level should add a little bit of bullish momentum and let the price action unfold more to the upside, at least in the short term.

The Level Lines seem to be confirming that the $39158 level is the main level for the ongoing bitcoin’s fluctuations, which I would dare refer to as noise. Otherwise, the next support is defined well at the $32228 level. For the resistances, the Level Lines are adjusted at the 46877, 52670, and 59802 USD levels, accordingly.

MTF 4H:

The MTF chart displays a lot of uncertainty and intraday noise happening, portrayed as lots of little-bodied candlesticks with both upper and low wicks, often equal in the size.

Currently, BTCUSD is squeezed to extremely low volatility as the last few sessions have brought no more than 300 USD range-bound movements between 38900 USD and 39200 USD. This series of candlesticks seems to be congesting right below the BaseLine average, which provides a sort of resistance at $39250. Once broken to the upside, it may generate a little bit of bullish thrust in the breakout direction. Potentially, this increases chances of retesting the $40000 resistance.

The BaseLine Bands reveal that the average volatility of bitcoin is focused in the 36200-42500 USD zone, with the highest chances of fluctuations to happen within a tighter zone of 37500-41300 USD. A strong breakout outside either of these extremes can lead to continuation in the direction of the breakout.

The BWAP block remains at the 39000-39250 USD region, providing an arbitrary base to help traders determine if bitcoin is more short-term bullish (above BWAP) or bearish (below BWAP).

LTF 1H – 4H:

The hourly chart fairly displays the level of uncertainty I have just described in the sections above.

The number of spinning top type of candlesticks moving within a very narrow price range seems to be confirming that the market participants are rather sidelined as of now. As mentioned before, this potentially leads to a more volatile period following a potential breakout, regardless of the direction.

The way I see it, the market is in a standby mode, waiting for more fundamental (external) triggers to arrive into the market, to build or back up certain direction.

The BPRO Wave Pivots imply that the local price action is occurring mainly between a local floor of 38700 USD and a local ceiling at 42300 USD. Any major breakout outside 38700 USD could lead to the lower level defined by the BPRO at the $35000 USD support level. Otherwise, the next resistance is at the $45000 USD level.

FEAR/GREED

The sentiment remains at its lows in the extreme fear territory.

The index points at the 22 level on the 100-point scale. The other chart represents well the overall market sentiment over the course of the last three months – flat fluctuations within an overall depressing market conditions.

It does feel as if the retail side of the market had alrady resigned and quit.

Yet, historically, when the crowds get substantially pessimistic it is usually good time for purchasing.

As mentioned many times before, the crowds are usually right in the middle of trends, and usually wrong at the extremes.

It’s testing traders’ patience at the moment, it does seem.

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