Bitcoin prediction this week March 02-08: the coin might rally to $9,200 this week
Daily charts suggest a relief rally might be possible.
The past week saw panic selling among investors of all asset classes as coronavirus cases surged across the world. Both risky assets like equities and crude oil and safe havens like gold and Bitcoin were sold aggressively.
Bitcoin received another blow when the U.S. Securities and Exchange Commission (SEC) rejected the Bitcoin ETF application filed by New York-based Wilshire Phoenix. The SEC was not convinced that Bitcoin is resistant to market manipulation and that investors interests are protected.
Nonetheless, while these short-term hurdles might cause a dip in the short-term, the long-term picture remains buoyant. Let us look at Bitcoin’s weekly chart to determine the long-term trend and analyse Bitcoin’s daily chart to do the Bitcoin price prediction for this week.
Bitcoin price prediction chart: weekly
The failure of the bulls to scale above $10,550 levels has attracted profit booking. Due to this, Bitcoin has dropped to the moving averages, which are likely to act as a strong support. A bounce off the current levels is likely to keep the leading cryptocurrency range-bound for a few days.
However, if the bears sink the price below the moving averages, a drop to the $8,000 to $7,853.95 support zone is possible. We anticipate the bulls to defend this zone aggressively because if it breaks, the BTC to USD pair can plummet to $6,408.10.
The pair will turn positive on a break above $10,550 and the long-term downtrend line. Above this level, we expect BTC to pick up momentum. The first target would be 14,000 and above it $17,300.
The Bitcoin analysis of the weekly chart shows that the price is stuck in a symmetrical triangle. Inside the triangle, the price action is likely to remain volatile. Let’s do the Bitcoin price analysis of the daily chart to see if we find any patterns that can help us project the short-term price action.
BTC to USD chart: daily
Bitcoin broke below the 20-day EMA on February 24 and the 50-day SMA on February 26. The failure of the bulls to defend the critical support zone of $9,000-$9,171 shows a lack of demand at these levels.
With the fall of the past week, the moving averages have completed a bearish crossover and the RSI has dipped close to the oversold levels, which suggests that the bears are in command.
Currently, the bulls are attempting to start a relief rally from $8,400 levels. Any pullback is likely to face resistance at the downsloping 20-day EMA. If the BTC to USD pair turns down from the 20-day EMA and plummets below $8,400, it can drop to $7,853.95.
Conversely, the first sign of strength will be a move above the 20-day EMA. Above this level, we expect the bulls to make another attempt to cross the psychological barrier at $10,000.
The Bitcoin price analysis of the daily chart suggests a relief rally might be possible. What are the possible ways to trade it? Let’s find out.
Bitcoin price this week March 02-08: how to trade it
The sharp fall of the past week triggered our suggested stop loss on the remaining long positions at $8,800. Currently, the short-term trend is clearly down as the price is trading below both the 20-day EMA and the 50-day SMA. Therefore, we do not find any reliable buy setup for the positional traders.
However, as the slide from $10,000 levels to $8,400 has been sharp, a pullback to about $9,200 levels is expected. The short-term traders can buy at $8,800 and keep a stop loss at $8,400. This is a counter-trend trade; hence, we suggest traders use only 40 per cent of their usual position size. We will wait for a reliable buy setup to form before proposing a positional trade in it.
FURTHER READING: What is the Ethereum market cap, and will it grow in 2020?