Mixed Signals Spark Caution, Yet Bullish Outlook Remains
Analysis of BTC/USDT across multiple timeframes reveals a mixed outlook for Bitcoin on June 8th, 2024.
In the long term, the daily chart shows a bullish trend with higher highs and lows. Importantly, the price remains above the uptrend line since May 1st. Key support levels are at $68,000, $65,300, and $64,000, with resistance levels from $71,800 and above. However, the Stochastic RSI (DTOsc) has entered the overbought zone, and the price reacted with a reversal upon reaching the key resistance zone of $71,800-$73,500, suggesting a potential pullback or consolidation.
The 4-hour chart shows a short-term consolidation within the $68,000 to $72,000 range. The Stochastic RSI has recently declined, showing signs of bearish divergence, indicating potential downward pressure. Note the price reaction at the key support level of $68,000. Any bearish breakout at this level has the potential to reach the $65,300 support level.
On the 1-hour chart, there is a short-term downtrend due to a recent sell-off. However, the Stochastic RSI is oversold, suggesting a possible short-term bounce. This could be stop-loss hunting behavior by market makers. The bearish candle with a long lower wick when the price touched the $68,500 zone with high volume demonstrates price support action.
My Trading Strategy:
For long-term positions, holding Bitcoin seems reasonable due to the overall bullish trend and strong support levels. However, monitoring the key support levels mentioned above and adjusting stop-losses are essential for risk management.
For short-term positions, it is advisable to wait for a clearer reversal signal or confirmation of support around $68,000 before entering new long positions. Alternatively, short-term traders could take advantage of the current downtrend, targeting support levels with tight stop-losses.
Overall, market sentiment is mixed, and traders should exercise caution while monitoring the market for clearer signals before entering new positions.
