These are the two critical levels for BTC to determine the medium-term trend (bitcoin price analysis)

The price of Bitcoin is approaching a significant level, which could prove decisive for the medium-term development of the market. Although there are some positive signs on the technical charts, it remains too early to decide if a new bullish phase is on the horizon.

Technical analysis

By: Edris

The daily chart:

On the daily chart, the price of Bitcoin has formed a large declining wedge over the past few months. The price recently rebounded from the lower boundary of the pattern and is currently trending higher towards the significant resistance level of $18,000.

In the event of a bullish breakout from the $18,000 level and the 50-day moving average located around the same price, a rally towards the upper boundary of the pattern near the $20,000 psychological level could be expected.

On the other hand, a rejection of the $18,000 level could lead to a further decline towards the $15,500 level, and another retest of the lower trendline of the declining wedge would occur.

Source: Trading View

The 4-hour chart:

Looking at the 4-hour timeframe, the price has successfully broken through the minor resistance level at $16,800 and is testing it again at this time.

In the event of a successful pullback and continuation, a rally towards the $18,000 area would be imminent. However, the RSI indicator should be watched closely in the coming days as it recently produced an overbought signal. It could also form a bearish divergence shortly.

The latter could lead to a bearish reversal in the near future, which could prove disastrous. This would likely trigger a decline towards the $15,500 support zone and possibly even lower if the level does not hold.

Source: Trading View

On-chain analysis

Bitcoin miner reserve

2022 has shown how bad a Bitcoin bear market can be. After multiple defaults and bankruptcies over the past few months and an appalling drop in prices, miners are apparently beginning to capitulate.

Miners can be considered the most important participants in the Bitcoin network, as they are responsible for validating and securing it.

They have also accumulated massive amounts of BTC over the past few years, and their buying or selling pressure can cause the price to fluctuate significantly. Therefore, the miners’ surrender is terrible news.

According to the Miner Reserve metric, which measures the total amount of Bitcoin held by miner wallets, they recently sold BTC in large chunks, which can be seen on the chart by the large drop in the reserve.

This worrying signal comes after multiple rumors that miners are not repaying their debts and therefore could be setting the market up for another massive crash in the near term.

Source: CryptoQuant

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Cryptocurrency charts by TradingView.

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