Bitcoin forecast: BTC could retest $70k before its next leg lower

View related analysis:

Bitcoin falters at $70k yet again, volatility could be set to remain

Bitcoin bulls eye record highs - but we could see some ‘chop at the top’

At the beginning of March and again this Wednesday, I outlined that tendency for Bitcoin to revert to volatile and choppy conditions each time it failed to hold above $70k. We saw two market tops and subsequent bear markets in 2021 following a false break of $70k, and the question now is whether history will repeat with a significant move lower.

Of course, volatility cuts both ways. So even if Bitcoin does enter a bear market (defined by a 20% fall from its cycle high), that is not to say it will happen in a straight line. And that provide opportunities for bulls and bears, but the key point I am making is that the parabolic bullish phase appears to be over.

The bias on Wednesday was for Bitcoin futures prices to bounce above $60k, and so far that has played out. Yet prices are now trapped between $60k and a series of historical all-time highs (weekly and monthly close), and prices do seem to be interacting with them to show their significance. So today is a quick follow u0p to look at intraday price action and hopefully identify a near-term opportunity.

Bitcoin futures technical analysis (daily chart):

The daily chart shows that Bitcoin futures did indeed bounce in line with the near-term bullish bias, a day after RSI (2) had reached oversold. Support was found above $60k and the daily chart closed above the $62,890 high-volume node, which suggests demand around that level. Therefore any pullbacks towards $63k may be favourable for bulls to seek dips.

Yet as the weekly RSI (2) remains below 50 but above the oversold zone, the bias remains for further losses on the weekly chart once the correction higher on the daily chart has played out.

Bitcoin futures technical analysis (1-hour chart):

The 1-hour chart shows a clear acceleration from the $63k area (a high-volume node). Prices are now retracing against that move as they presumably fill the liquidity pockets left by the strong rally. But perhaps we are at or near a bullish inflection point for this timeframe. The RSI (2) reached oversold and a bullish engulfing / outside candle formed above the TPO VAH.

Bulls could seek dips above $64,400 with $67k as a target, a break above which brings $69k and $70k into focus
If prices continue lower, the next area of support for dip buyers to consider is the $63k area, near the HVN

-- Written by Matt Simpson

Follow Matt on Twitter @cLeverEdge

How to trade with City Index

You can trade with City Index by following these four easy steps:

Open an account, or log in if you’re already a customer

• Open an account in the UK
• Open an account in Australia
• Open an account in Singapore
Search for the market you want to trade in our award-winning platform
Choose your position and size, and your stop and limit levels
Place the trade

StoneX Financial Ltd (trading as “City Index”) is an execution-only service provider. This material, whether or not it states any opinions, is for general information purposes only and it does not take into account your personal circumstances or objectives. This material has been prepared using the thoughts and opinions of the author and these may change. However, City Index does not plan to provide further updates to any material once published and it is not under any obligation to keep this material up to date. This material is short term in nature and may only relate to facts and circumstances existing at a specific time or day. Nothing in this material is (or should be considered to be) financial, investment, legal, tax or other advice and no reliance should be placed on it.

No opinion given in this material constitutes a recommendation by City Index or the author that any particular investment, security, transaction or investment strategy is suitable for any specific person. The material has not been prepared in accordance with legal requirements designed to promote the independence of investment research. Although City Index is not specifically prevented from dealing before providing this material, City Index does not seek to take advantage of the material prior to its dissemination. This material is not intended for distribution to, or use by, any person in any country or jurisdiction where such distribution or use would be contrary to local law or regulation.

For further details see our full non-independent research disclaimer and quarterly summary.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 69% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work and whether you can afford to take the high risk of losing your money. CFD and Forex Trading are leveraged products and your capital is at risk. They may not be suitable for everyone. Please ensure you fully understand the risks involved by reading our full risk warning.

City Index is a trading name of StoneX Financial Ltd. Head and Registered Office: 1st Floor, Moor House, 120 London Wall, London, EC2Y 5ET. StoneX Financial Ltd is a company registered in England and Wales, number: 05616586. Authorised and regulated by the Financial Conduct Authority. FCA Register Number: 446717.

City Index is a trademark of StoneX Financial Ltd.

The information on this website is not targeted at the general public of any particular country. It is not intended for distribution to residents in any country where such distribution or use would contravene any local law or regulatory requirement.