Daily Report – Bitcoin and Market Update (September 27 2021)

By Cryptobirb

HTF 1W:

The weekly candle closed with swing failure pattern or a fakeout candle – the support was breached but week closed above the broken support validating the strength of the bulls area down there. 50-week average at 38.7k may still be tapped momentarily within 37-39k region but Id personally expect any dips in there to be bought back fast and heavily.

Birbicator on the bottom suggests the trend and momentum are locally trending down so the strength of bulls is quite limited. Better for the bulls to revert back with strength from the said areas.

So far the SFP weekly candle may be early signal for local upswing in the building. 53-58k target area still remains anticipated for the bullish retest in the region.

Overall thesis for the final legup of the bull run remains strongly unchanged until proven wrong.

Here’s the said SFP candle closing higher than the broken prior support:

HTF 1D:

The daily chart is showing some mild form of contracting pattern – falling wedge, while within daily Bollinger Bands. The average volatility ranges from 41k to 49k and that should cover 95% of price action in the coming days. Breakout over the wedge may cause broader move towards upper BB at 49k, which if sees a daily candle closing through, would mean confirmation of a volatility breakout and trend continuation.

Momentum and trend per Birbicator on the bottom shows some form of consolidation as well which is slightly more upside-oriented than the wedge pattern in price. Seems that daily close over 45k would confirm both breakouts: wedge and triangle on the momentum side. Once that happens, price trend should get additional boost and momentum increase.

37-38k can not be got out of the table just yet.

HTF 12H:

The middaily chart is showing bitcoin’s battle around long-term aVWAP trendlines which are completely flat currently. This shows the average state of the market is sideways for past few weeks. Within the sideways you can expect bitcoin to oscillate around its average price back and forth as that’s pretty much a definition of a sideways movement, which is not directional. In other words, bitcoin is not trending on average now. This brings all the chart patterns, trendlines, formations to be of limited effectiveness or predictive power.

Currently trading at 43319 bitcoin remains under its local black aVWAP 45120 representing average fair value of bitcoin ever since recent 53k peak.

One can notice that BTCUSD is somewhat trapped by the said aVWAP 45120 and 38.7k 50-week average so locally Id expect bitcoin to move within those levels.

A strong daily close over 45120 would likely lead to retest of high 40000s.

MTF 4H:

Not much has changed since my last 4h chart update. MTF chart is still trading sideways in quite a deviated range which after two consecutive fakeouts (one on the top, and at the bottom). Those fakeouts effectively broadened the range to spread between 39.6k and 53k. The higher into the supply, the better selling opportunity. The closer to the bottom of the demand zone, the better buying opportunity it becomes.

Inside ranges anything that happens is considered neutral, not bullish or bearish. The neutrality makes it rather poor deal to make any trading decisions around its center values 46-47k. Still need to watch the blue curve aVWAP anchored at the peak of the fakeout, with fair price of bitcoin ever since at 45.2k.

Currently no patterns, trendlines, candle formations have much predictive power within the range boundaries as the market is not trending in any direction, just swinging back and forth more or less chaotically. How to trade this range?

  1. Inside Range Trading : buy the range lows, sell the range highs
  2. Outside Range Trading: buy the upside range breakout (or retest), sell the downside range breakdown (or retest)
  3. Do not trade the range at all.

LTF 1H:

Currently BTCUSD is seeing only a few clear support/resistance levels in the hourly chart.

Supports: 42.8k, 42k

Resistances: 45.1k, 46.7k

We can assume here in the range there are high chances (although lower than in trending markets) that once either level is broken, then bitcoin continues to the nearest subsequent level in the same direction. In other words, once 42.8k is broken with a strong 1h or 4h close below, then BTCUSD proceeds down to 42k. In case 45.1k resistance is breached, the next resistance to pay attention to is 46.7k. And so on.

Other than this, its trading in a local range between 39.6k and 45.1k. Technically speaking, if the range sees an upper breakout then the target is of 5.5k usd distance from the highs of 45.1k (around 50k) or from the lows (34-35k). If the latter comes, bulls may expect more trouble for them for the time being.

NUPL

This onchain metric suggests that at 0.51 the market is inside its belief zone, showing very mild suggestsion to keep locking in the profits in the next months.

No actual divergence found in here so Id read that as an overall stability/stagnance on the market coming from the lack of local trend.

FEAR/GREED INDEX

The fear saga continues. Market’s sentiment is valued at 26 points on the scale nearing extreme fear. This area historically has always been about good buying opportunities way more often than good selling opportunities. Knowing that the crowds are always right in the middle of trends but always wrong at the extremes, it implies that counter trading the fear should be effective source of returns for the upcoming weeks. It doesnt mean or signal definite bottom. Instead it suggests whenever the market is undervalued and here it’s confirmed by the sentiment. As long as it maintains extreme fear or fear for BTCUSD then it marks it on the chart as a good buying zone for the potential upcoming final leg up of this bull market.

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