We’re taking a look at the Bitcoin price here on the daily. You’re getting that bounce, getting that relief rally from this major support of the lower lows and also closing a daily candle above the lows of 2021. We had lows such as 27 000 range here. Also the 28.6 all of these lows, we actually dipped below in one day yesterday and managed to close above these lows meaning that we could have this kind of swing failure pattern. we could have a small sideways action relief rally before we actually continue to the downside now. We’re also going to take a look at the one hourly chart here because what I want to explain is some major opportunities, we did actually get that rejection beautiful rejection from the scenario that we talked about yesterday looking at the fib levels from the highs here to the lows looking at that 618 here at that daily level round about the 29 700 range. We’ve got the rejection but we came straight back up to this range breaking this daily level. Now there’s also a bullish case scenario here.
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On the downside we’ve got major resistance on the VPVR, so it’s going to be very difficult but with a little bit of risk management. You can actually make successful trades and I want to try and explain some situations, also looking at the Ethereum chart, because Ethereum actually started breaking down here from this ascending channel just after Bitcoin. We’re looking at this scenario also on the live streams, looking for the summer 2021 lows to be hitting that 1 800-range getting that bounce. We’re going to take a look at some potential scenarios here on Ethereum.
Let’s dive in here because what I want to show you on the daily is how we did manage to actually hold this major range and close a daily level above the lows of 2021 all of the lows now. As you can see, there is a scenario here of a descending wedge with these lower highs and these lower lows. As you can see, we actually got that reaction and consolidation from this range after the severe drop that we’ve had for the last couple of weeks. So, are we going to have a consolidation? Are we going to have a relief rally? This is something I want to talk about looking at the one hourly chart. But what I want to show you here is that all of the laws were created back in 2021. Since January, we have one over here at 27 734 and all of these lows here are slightly above 28 000 right over there. Many retested at these levels in January, February and even the summer of 2021.
What happened was that we never came back down for several months. Since July to reach these lows now, we have now retested the lows. We have actually closed a daily candle above this range. We’ve only had this massive big kind of hammer big massive wick here on this daily and you can see that the close has been at 28 896 here on the BitStamp chart. As you can see, getting that relief rally. We are getting that kind of consolidation relief rally, so there is a possibility after this severe drop that we are going to get a relief rally consolidation maybe for the next coming days – even a couple of weeks. It is very possible after such a big drop on the price of Bitcoin. Then this is what usually happens all right before actually continuing hard to the downside. If we were, we could have a consolidation inside of this range and kind of this descending wedge.
So, what I want to show you here also is the big massive resistance because, maybe, we are not going to manage to get a big relief rally as we do have one of the strongest points of control above us right now. Looking at this daily chart looking at the volume traded from 2021 to 2022, we can see you know at 31 000. It is the start of the biggest point of volume. It does actually start around the 30 000 range but the biggest point already starts at 31 000 area. This is where we’re currently getting that kind of rejection, so there is a possibility also you know that we are maybe going to get rejected from this level. But I want to show you the bullish short-term scenarios on the one hourly chart where you could take advantage of the situation. If we go to the one hourly chart here on Bitcoin, we were talking about this big major resistance. You need to protect yourself, if you are shorting from this level and already in some pretty good profits because you could have a bigger relief rally now. It was also the 618 here from the highs as we mentioned yesterday hitting that 618 hitting that daily hitting this major resistance level where we did bounce as support and as resistance right there. Getting that small rejection, but what happened here on the one hourly. As you can see with volume is that you are getting some buying pressure. You are getting the balls stopping this price level looking for that bigger relief rally. This is why you know you actually created a higher low right over here getting that support right over here from this major volume candlestick.
As you can see getting that small bounce to the upside now, what are the opportunities here on the Bitcoin price. You might want to know, of course, well. As you can see we kind of formed an inverse head and shoulder right over here where we did have this lower low and a higher low right there, breaking this kind of neckline right, where we did retest it twice. This is the twenty-nine thousand seven hundred dollar range. We are actually above this level and we actually could consolidate and have a leg up on what would be the price target. The textbook price target would be getting the head to the neckline kind of something like this and from the breakout. You could go as high as 34-34.5 000 . But what the problem is with this is that we have huge resistance here looking at the vpvr as you can see at the 31 400 is the biggest point of control which is from this big major consolidation. There is a possibility that the price is not going to manage to get above this big major cluster of resistance. If we do, then I do see a high chance on the Bitcoin price to actually reach the 34 even 35 000 major relief rally because after such a severe drop looking at the one hourly from this range from the top of the drop to the lowest part.
The fibonacci 618 which is the most common retracement is all the way up here at 34.3 000 uh so there is a possibility that the price action of Bitcoin you know after this breakout of the inverse head and shoulder we need to take a look at the relief rally scenario after this major drop for the last few weeks that the target from the inverse and shoulder from the lowest part to the neckline. It would actually take us to that range 34.5-34-34.5 which is the 618 from the start of the drop. This is very much in the cards before we actually continue to the downside. I know the bears want the price of Bitcoin to hit 25k-20k-18k-15k. This is very possible of course in the next coming months, but we need to look at those potential relief rallies, when you see this kind of price action with BTC inverse small inverse head and shoulder on the one hourly. Hitting the major fib levels also from this major drop.
What I want to show you here right now, also with this fibonacci retracement from the start of the drop which was back in the beginning of May until yesterday, where we hit those lows here at 25.3-25.4 now. What I want to show you here is that we are actually getting resistance from the 382. But to the exact dollar, we are getting that rejection from the highs here to the lows. We are getting rejected to 382 which is 39 900. We almost hit 31 000 just a few hours ago and I know a lot of people are saying: ‘We’re going lower, we’re going lower!’. But, we actually hit 31 000. Nobody would have known, we would have had that relief rally when we were just trading at 26-27 000. This is why I think a lot of people are not expecting potentially 33-34 000 in the next coming days. It’s very much likely to happen before we actually continue to the downside. But like I said a lot of resistance, this is a very critical area. It’s very difficult right now because we have a lot of resistance and we have this kind of small relief rally scenario with this inverse head and shoulder. But the biggest resistance that we do currently have right now is this VPVR level at 31.4k level. If we take a look at the VPVRs, at the resistance taking a look at the biggest point of control from the 9th of May, the 10th of May, the 11th of May. It is exactly around about 31.4 right. This is why we saw the general VPVR here on the sides, telling us that the biggest one is right over here.
This is why Bitcoin you know is going to get heavily resistant at that 31 31.4 range. We’ve got one here at 31 000, at 31.6 31.4. The average is at 31.4 and this is why if the Bitcoin price does manage in the short term get above, this major cluster on the VPVR hitting 32 32.5. It is very likely that this range will hold as support and continue to the upside to hit those fibonacci retracement 618 levels from the high to the low. Then potentially get major rejection because we have a strong level of resistance. This is what I would be looking for a potential swing trade low. If we were to hit this 34k level all right in the next coming days that would be an insane level. I think for a potential short opportunity, I think a lot of people will be becoming bullish at those levels. If we do see that kind of prize action the next coming days, of course, that is very far away. There is the scenario where we’re not going to get above this major cluster on the VPVR. This we are hitting one of the biggest resistance levels right now. There is a possibility that we’re potentially going to get rejected from this range and continue to the downside.
This article is a transcription of a video made by Andy Bitcoinsensus
Original video: https://youtu.be/UvWpzJ2zq9M