Bitcoin Futures (BTC1!) – Exhibiting a strong downtrend, but some recovery could be on the line

Bitcoin Futures (BTC1!) – Exhibiting a strong downtrend, but some recovery could be on the line

After plummeting to a fresh two-year low at 14,900 in the first week of November, Bitcoin Futures (BTC1!) has been pushing to recover some of the lost ground and managed to jump more than 15% in the following sessions. Sentiment in the crypto arena improved, especially after the Fed Chair suggested the central bank could begin easing back on its interest rate hikes starting as early as this month. Hence, the crypto-king kicked off Monday’s session with a small upside gap of 0.56% triggering the liquidation of 9.26M in short positions representing 60% of the total liquidations for the day.

Moreover, although trend indicators are still drawing a dim picture, as the 20-and 55-week exponential moving averages are sustaining a sturdy bearish bearing, the oscillators are hinting at further price appreciation in the forthcoming sessions. The stochastic oscillator has completed a positive crossover just above the oversold territory while the MACD jumped over its signal line in the negative territory. Additionally, the RSI in contrast with the price action has posted a higher low lately, reminding of a positive divergence – a warning that the bears may be running out of fuel.

The path higher, however, is not expected to be smooth as several tough obstacles are lying ahead, starting from the last June bottom at 18,500. A short distance higher, the 20-week exponential moving average seen around 20,200 may try to deter additional advances towards the key August high of 25,300. Should the rally gain further momentum beyond the latter, the gates will open for the 55-week exponential moving average at 27,500 just ahead of the June 2021 bottom of 28,800.

Otherwise, if sellers return to the game, they could initially approach the 161.8% Fibonacci extension level of the last corrective wave at 14,300 overlapping with the 2019 peak. Lower, they will pursue the 10,000 psychological level and the 261.8% Fibonacci level at 7,500.

In short, despite the clear downtrend, the technical picture is increasing the stakes for some stabilization in the market. Perhaps a decisive close above 20,200 could help the crypto-king to gain some extra ground.