After Extreme Sell Off Bitcoin (BTC) Entering The Golden Pocket

By moon333 | moon333 | 20 May 2021

Re-testing of weekly EMA 21:
The priceline of Bitcoin was re-testing the weekly EMA 21 after Sep 2020, the previous weekly candlesticks is closed above the EMA 21 but now the current week’s candlesticks is moving below this weekly exponential moving average . But we still have 3 days left if the price action moves above this EMA and this week also closes above this moving average then Bitcoin can continue its rally. The EMA 21 weekly is at $45820 at the moment.

In the previous bull run, we had several re-tests on this weekly exponential moving average 21.

2017 bull run:

2013 bull run:

Important support zone:
We have a very important support zone from $40K to $30K. The $40K level has been working as resistance and $30K has been working as a support during the current bull run. After the recent drop the price action broke down the $40K level and reached the $30K support, this level again worked as strong support and the price action has been bounced to $40K back. But so far the price action of Bitcoin is not able to breakout the $40K again.

Dropped at golden pocket:
During the current drop the price action of BTC dropped very close to the golden ratio of Fibonacci retracement level that is 0.618 Fib level. If we place the Fibonacci tool at the March 2020’s low up to the highest price of April 2021 then we can see the Golden pocket 0.618 comes at $27500 and the price action dropped up to $30K that was too close.

A possible broadening formation:
On the daily time frame chart the price action of Bitcoin has found down trendline support and likely to have another bounce from this support. The RSI is already oversold and the Stochastic is oversold and has given bull cross but the directional movement is still bearish . If there will be good buying volume entered the market then the price action of Bitcoin may move above the weekly EMA 21 and will form a broadening formation as well.