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Bitcoin Update for May 29th, 2021

I'm sitting here trying to think of something positive to say about bitcoins price action but I am struggling to find anything. The $35k level had been holding for a while (just barely) but as I am writing this BTC is slowly dropping lower. I guess the only good thing I can think of is that bitcoin hasn't completely dumped yet.

Bitcoin 4-hour Chart

So first as usual we will look at the 4-hour chart. Unfortunately, bitcoin isn't looking too good here, it has dropped below the POC (point of control) which is the highest volume node. This high volume area is right about at the $38k level which supported bitcoin for quite a while but will now act as a pretty strong resistance level. You can also see that both of the indicators have turned and are now heading down in a bearish manner. There isn't much that I see right now that points to any bullishness for bitcoin.

Bitcoin 2-week Chart

Unfortunately, I am starting to believe we may see something like what is shown in the chart above. I am not really expecting a quick drop but over time as bitcoin slowly drops and trades sideways I feel that it will head toward the long-term trendline. I think we will see bitcoin act as it has in the past once it reaches the trendline, trend higher following it then at some point push away to another all-time high.

I also want to say that I am still not totally convinced what I show in the chart will happen. My hope is still that we will see something similar to the 2013 bull market where bitcoin suffered through a deep correction, a 6-month consolidation, then rocketed higher to the final peak.

Bitcoin Weekly Chart

Ending on a possible positive note we will look at the weekly chart. This week's candle which closes in about 34 hours is forming an inverted hammer candle. The inverted hammer candle can act as a trend reversal candle, which would be great to see. It also looks similar to a possible morning star reversal pattern. This is about the only positive sign I can see on any of the charts.

All we can do is wait and watch to see where bitcoin goes from here. I am hopeful that this bull market will continue at some point but I am also mentally preparing myself just in case it is over.

Take care!


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