With the Russian forces getting deeper in Ukraine, Bitcoin prices surged around 13% as buyers stepped in near $35K and propelled higher prices. The uptrend breaks above the multiple small milestones but struggles to surpass the psychological barrier at $40K. The uptrend forms a range with the support at $38,400 and the $40K barrier.
Currently, the BTC prices reject the $40K barrier resulting in a downfall to the support level at $39,400. The rejection brings an evening star pattern led by a strong bearish candle. However, the falling prices hang at the support level with the chances of further sideways continuation.
Taking a look at the $40K barrier, the bearish bunker has endured multiple bullish strikes over the past 48 hours, resulting in a loss of trend momentum. Adding points to the bearish powers, the higher price rejection evident by the long wick formations in the 4-hour candles from the $40K stronghold increases fear.
However, the reversal within the range keeps the continuation going as the prices surpass $39K once again, and the battle continues between the two opposing forces.
Should You Buy Bitcoin Based On Technical Indications?
Currently, the Bitcoin price action shows a struggling uptrend moving sideways below the $40K. However, combining the price action with the technical indicators can better indicate the upcoming trend. So, let’s have a look at the technical indicators.
Exponential Moving Average (EMA): The 50-period average (red) remains above the 200-period average line (white) in the 4-hour chart, reflecting a bearish alignment. The prices keep challenging the 50-period EMA, but the surge in selling pressure makes it harder to sustain above the average line.
Moving Average Convergence/Divergence (MACD): The MACD histogram shows a fall distribution in the bullish trend as the fast and slow lines indicate the possibility of a bearish crossover.
Relative Strength Index (RSI): The RSI indicator shows a sideways movement above the halfway mark indicating the bulls are taking a rest after the recent rally. The slope showcases a bullish divergence, with the last two peaks formed near the $40K barrier.
In a nutshell, the technical indicators remain neutral, but the sustenance above the 50-period EMA will indicate a bullish signal.
On-chain Based Crucial Bitcoin Levels
As per the on-chain analytics, the Global In/Out of the Money indicator shows almost 62% of hodlers making money at current prices, with 4% addresses holding at current prices.
The next resistance cluster mark indicates a zone starting from $40k to $45K, which seems slightly more substantial than the support cluster between $36K to $38K. Hence, the mental picture gets a little bearish, but considering the In/Out of the Money around the Market Price, the bulls seem to have a comeback chance.
The In/Out of the Money around the Market Price indicator shows the BTC price dangling within the $39K range. The upcoming cluster projects an equally opposite force to the support cluster ranging between $38K to $39K. However, the following barrier until $41.6K is an easier target to reach. Hence, a bull run to $41.6K is possible if the prices overcome the $40K barrier.
Moving on to the transactions talk, the Total Netflow of large hodlers shows a positive change of +458.87%, indicating an overall inflow of BTC. Hence, the numbers suggest that the large holders (those who possess at least 0.1% of the circulating supply) actively buy the dip.
The crypto market sentiment chart shows the emotions getting in the Extreme Fear zone. This can be credited to the ongoing geopolitical issues between Ukraine and Russia. However, the slow but steady rise marks the possibility of institutions on a buying spree.
Wrapping up the analysis, the upcoming days can be highly volatile, and the possibility of fakeouts and long-range daily candles can shake out many short-term traders. However, the bulls might overcome the final battle and gain control of the $40K stronghold once the global political issues cool down.
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