BTC/USD etched out its first weekly loss in four weeks.
However, is this enough to forecast a reversal to the downside?
Weekly Resistance Welcomes Sellers
We have clearly seen the major crypto pairing bump heads with sizeable resistance on the weekly timeframe at $51,952, a level boasting strong historical significance and sponsored by the Relative Strength Index (RSI) demonstrating signs of early negative divergence within overbought territory (ahead of indicator resistance at 83.18).
Ultimately, though, through a series of higher highs and higher lows, the long-term trend remains resolutely to the upside, supporting the possibility of further buying. That does not mean a correction from weekly resistance could not come about over the coming weeks.
H4 Diamond Top Pattern This Week?
While an uptrend in this market remains evident, and while it is usually recommended to trade with the trend, there are times when a countertrend opportunity provides a viable trading opportunity worth exploring.
You will acknowledge from the H4 chart that buyers and sellers spent the week battling for position around the weekly resistance highlighted above at $51,952 and in the process carved out a broadening pattern between two diverging lines taken from $52,868 and $51,372.
Broadening patterns can form the beginnings of a diamond top pattern. As shown from the chart, the second part of the diamond top formation extends from the broadening formation in the shape of converging lines. Were pattern completion to unfold, this is considered a weighty bearish reversal pattern, and bearing in mind it is forming around weekly resistance, BTC/USD bulls may struggle to find acceptance at higher prices and prompt a retest of $50,000 (possibly even navigate south of the psychological base towards daily support from $47,987, closely followed by another layer of support coming in at $46,331).
This material on this website is intended for illustrative purposes and general information only. It does not constitute financial advice nor does it take into account your investment objectives, financial situation or particular needs. Commission, interest, platform fees, dividends, variation margin and other fees and charges may apply to financial products or services available from FP Markets. The information in this website has been prepared without taking into account your personal objectives, financial situation or needs. You should consider the information in light of your objectives, financial situation and needs before making any decision about whether to acquire or dispose of any financial product. Contracts for Difference (CFDs) are derivatives and can be risky; losses can exceed your initial payment and you must be able to meet all margin calls as soon as they are made. When trading CFDs you do not own or have any rights to the CFDs underlying assets.
FP Markets recommends that you seek independent advice from an appropriately qualified person before deciding to invest in or dispose of a derivative. A Product Disclosure Statement for each of the financial products is available from FP Markets can be obtained either from this website or on request from our offices and should be considered before entering into transactions with us. First Prudential Markets Pty Ltd (ABN 16 112 600 281, AFS Licence No. 286354).
Recommended Content
Editors’ Picks
Ethereum has lost its “ultra” sound money status, faces key rectangle resistance hurdle
Ethereum is up 0.5% on Thursday following a recent analysis showing that the top altcoin lost its "ultra" sound money narrative. Meanwhile, ETH ETFs recorded net inflows for the first time after nine days of consecutive outflows.
Solana bears dominate market as SunPump has potentially led to less demand for SOL
Solana is down 2.5% on Thursday following bearish signals across its funding rate and total fees captured. SOL's weak performance could also be linked to the declining traction seen in its meme coin generation platform Pump.fun.
AI tokens see narrow gains as Wall Street banks raise price targets on NVDA
AI tokens NEAR, ICP, RENDER and TAO briefly traded in the green on Thursday following Wall Street banks' positivity toward Nvidia's earnings report. While a correction followed, these tokens could rally if NVDA meets expectations.
XRP back above $0.57 even as Ripple traders take $8 million in profits
Ripple (XRP) traders have consistently taken profits on their holdings in the last two weeks, per Santiment data. Once again, traders have grabbed $8.36 million in profit so far on Thursday. Typically, profit-taking negatively influences the asset as it increases the selling pressure.
Bitcoin: Will BTC continue its ongoing decline?
Bitcoin (BTC) trades above $59,000 on Friday, but it has lost 7.5% this week so far after being rejected around the daily resistance of $65,000. The decline is supported by lower demand from the US spot Bitcoin ETFs, which registered a net outflow of $103.8 million, falling Bitcoin's Coinbase Premium Index, and a spike in Network Realized Profit/Loss. However, some investors seem to be taking the chance to buy BTC amid this price dip, as shown by the Exchange Netflow data.
Moneta Markets review 2024: All you need to know
VERIFIED In this review, the FXStreet team provides an independent and thorough analysis based on direct testing and real experiences with Moneta Markets – an excellent broker for novice to intermediate forex traders who want to broaden their knowledge base.