Daily Report – Bitcoin and Market Update (May 31 2021)
Weekly closed as a harami type of candle (inside bar) where most of the last week’s trading was trapped inside the candle body of the final breakdown week, which can be considered confirmation of the demand zone below 34.7k. Near-length trend indication is downwards yet it’s not the bull market’s end yet. As given multiple times in previous reports and recent webinars, this sell indication from 3 weeks ago right before the biggest crash reminds me of H2 2019 price action pattern. Due to abnormal volatility of past weeks, it’s rather safe to assume that BTCUSD has low chances of going below or above current extreme levels of 30k and 65k for the next few weeks-months. For this reason, Im expecting some form of consolidation between these boundaries encapsulated in form of a chart pattern – e.g. a symmetrical triangle, or a wedge. As the high and the low seems to have been established for now, I’d expect lower high to form after an upside pullback into 50k region. Near-length hybrid average proves resistance at 47.7k with local BWAP resistance at 41k. Breaker High at 62584 is the level required by bulls to reclaim bullishness of the trend. Until it happens, the market is neutral or downside oriented. Breaker Low at 29517 is the most important level in the chart within current price zone and should be considered last bullish bastion. In case this level is reclaimed by bears with an ugly weekly/monthly close below that level, bulls are in big trouble and then we could optionally discuss any pre-mature bear markets. We still may see 30k lows swept (although low chances imo) and even if we temporarily break 29517 for a brief moment but still manage to close the week above this level, that’s considered intraweek deviation and confirmation of demand – bullish fakeout. If Breaker Low Is lost, S3 21491 support is next and you always should be prepared for this in case military conflicts and global market crash occur.
Daily pattern is forming a symmetrical triangle or a pennant as a consolidation after sharp declines aka accumulation. Compressed support area for MTF traders is 28878-34566 and anything inside this zone is considered good buying opportunity. Breaker Low is key daily level to reclaim by MTF bulls at 43755 and once this level is reclaimed bulls can get the sigh of relief as the worst will have already been behind. 43-43.7k is generally a strongly confluent resistance and combination of several resistances: price action (S->R), BWAP, baseline average, BVWAP, 3-month head & shoulders neckline breakdown retest. This combination makes it the strongest resistance in current region for bitcoin in my opinion. 62076 for Breaker High is once again confirmed to prove that bulls are not “officially” back until we see weekly/monthly close over 62k.
Middaily candle closed over the baseline for the first time since before Elon Musk suspended crypto payments for Tesla. It’s first and early sign of “strength” since pre-FUD market crash. It’s not flashed buy indication yet but as long as BTCUSD trades over the baseline, bulls are safe. There’s high probability that we would see upside continuation towards 40k within the next days and possibly even upside volatility breakout after any middaily session closes nicely over 40k. This could theoretically indicate upcoming 12H BWAP 43.5-44k retest (level confluent with daily strongest resistance area). Breaker Low is 35431 and I’d love bulls to defend this level and continue trading above to unlock 50-55k retest to establish weekly lower high (perhaps not lower?). Again, until BTCUSD 12h flashes buy mode on BPRO default settings, we still have to take all the bullish early signs with the grain of salt and caution. It’s in the spring preparation period – sort of bulls warming up to go.
MTF has just flashed another buy signal BUT take it with the grain of salt again as the baseline average is going sideways – lots of noise and low-reliability signals. The market does not start trending at all sooner than we see upside breakout over 40-41k area (long-range upper band + BWAP) OR downside breakdown below 31k. The breakout must be confirmed by a higher timeframe session over or below the mentioned levels (e.g. daily close above 41k or a daily close below 31k). As the market is ranging currently, the breakout direction will define the trend. For short-term to medium-term bulls I can see market reaching as high as 53-55.3k (Breaker High – R3) area assuming that bulls manage to break through the daily resistance cluster 43.5-44k. In case military conflicts escalate with new FUD series put on BTCUSD, I’d look down at 28185 support. As unexpected as it may seem right now, keep that level in your mind and have some spare cash on side in case it comes. In trading it is always better to be safe than sorry.
Hourly has just flashed buy signal over the baseline which could lead to 39k long upper band retest. Breaker High is 39332 and once this is reclaimed, short-term bulls may continue towards 43k area. Daily close over 40k is preferred. BWAP resistance at 41.8k combined with R1 41956 is key resistance cluster where we could expect local bulls exhaustion and retest of 38-39k area. Do not forget that current “trend” is sideways i.e. there’s no trend. Expect lots of f*ckery still, liquidity hunts, low timeframe bullish patterns to be broken down, bearish patterns to be broken up, supports broken just to liquidate over leveraged positions. Do not over trade this area below 43k imo. Same applies to alts.
NUPL still in the lows area ~0.43 which proves that the market is currently under valued short-term after sharp price and NUPL declines in past weeks. NUPL top conditions have not been met during this market cycle yet, which makes me still hold my point that BTC top is NOT in for this and many other reasons.
MA7 over active addresses may be suggesting some form of unofficial hidden bullish divergence (unofficial because MA7 addresses is not a tradable index so technical analysis should rather not be applied literally). One can observe more severe wallet addresses reset (over-liquidated and oversold market) than the decline presented by the price action assuming that 30k lows are in. Point is invalidated if 30k support is violated but this potentially may mean some larger reload or market spring is forming.
FEAR/GREED sentiment index shows 18 points out of 100 on the scale with very severe sentiment change since the last month. The market continues to fear in an extreme manner which usually provides nothing but a historical buy-the-dip opportunity for traders. One may pick fundamentally valuable projects – Id still suggest main focus on BTC, ETH, LTC, LINK – to load on 50-70% dips and simply wait for a few days-weeks to realize profits after 50-70% recovery pumps. Provided that no unpredicted black-swan events come (WWIII escalation etc.), in my honest opinion we may not see such good buying opportunity in this bull market with few months left to go. As always, more details in #nc-video-report available to the exclusive members of The Birb Nest. If you enjoyed my market report (possibly the last one before my wedding), please leave a sticker to confirm. God bless.