Given the sheer depth of negative market sentiment for Bitcoin, it would take a brave person to predict that a bottom could be in. However, based on technical analysis, the bottom is indeed forming, or is already in. Is this the case, or is the vast majority of the market right, and the bull market is over? Source: Alternative.me Sunday’s Fear and Greed reading of 10, which is one of the lowest measurements since the beginning of 2018, expresses just how bad market sentiment has become. Be that as it may, every other time sentiment has been this poor, it has marked a bottom and a big rally has usually followed. A bounce from major confluences Source: TradingView The 4-hour chart for the $BTC price shows that the price has just retested the confluence of the descending channel (blue lines) and the major ascending trendline. The 0.618 Fibonacci also runs directly through this confluence, so if there ever was a place for a bounce it was here. Will there be any more sideways and downwards choppiness? Possibly, yes. The very low time frames are showing overbought, as in the 4-hour Stochastic RSI indicators in the chart, but all the higher time frame indicators have reset and are ready to climb, so this next upside leg could get going after perhaps one more little retest of the supports. Major trendline is redrawn and becomes bullish Source: TradingView As can be seen in the daily time frame, the major trendline underneath the price has been redrawn. This trendline was previously being taken from the August low. However, it can be drawn from the early part of the bull market, and it can be seen that candle bodies did not confirm below, even during those lows of August and September. This puts a different perspective on the $BTC price , and shows that instead of confirming a breakdown, the price is instead bouncing from the trendline. This puts a far more bullish slant on things, and correlates better with other indicators. Retesting the bottom of the blue channel was another bullish factor. Descending channels would normally break to the upside, so it would be more probable that the price rises back to the top of the channel from here, breaking back above $100,000 on the way. Mostly bullish in weekly time frame but ... Source: TradingView Looking at the $BTC price from a weekly viewpoint, it can be observed that the trendline is good and that a bounce can now take place from here. It remains to be seen how strong that bounce eventually becomes, and whether it will have the momentum to break through the top of the 8-year ascending trendline. 4 relatively recent knocks on this particular glass roof will have weakened it. The weekly Stochastic RSI indicators are now practically at the bottom, and should soon be ready to angle back up, eventually signalling plenty of upside price momentum. At the bottom of the chart, the RSI indicator has fallen below the 44.00 level, which has previously acted as bull market support. Bulls will be hoping that the current tick up will not be to confirm the breakdown, but will rise through the 44.00 level and confirm above. Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.
