The Bitcoin price seems to know no stopping at the moment. Even at the beginning of the new trading week, the market-leading cryptocurrency is still on the upswing. Thus, BTC / USD is trading at around $ 46,000 at the time of publication. This is the highest level in several months.

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Just a few weeks ago, Bitcoin hit lows around $ 29,000 and has since seen a massive jump in price. Growth is around 58 percent. Thus, the bulls seem to have the market firmly in their hands again and some investors of Bitcoin will already dream of new records. But can it really continue like this or is a strong correction imminent? The technical analysis provides exciting clues for the price development of BTC/USD in the coming weeks.

Bitcoin again well above the 21 Week EMA

First of all, there are some technical indicators that illustrate the current upward trend. Thus, on the weekly chart of the Bitcoin course, it turns out that BTC/USD successfully crossed in the area of $ 40,000 of the 21 Week EMA. This price average line for the past 21 weeks has always been an important indication in the past that Bitcoin momentum is bullish.

During the Bitcoin correction in May 2021, BTC / USD lost this important support at $ 45,000, after which it recorded a correction of around 50 percent. In the bull market in 2017, however, Bitcoin had bounced up several times on this support line without breaking through it and subsequently continued its upward trend.

The Bitcoin price could even correct a few thousand dollars again without the bears gaining the upper hand. Confirmation of the 21 Week EMA as new support by another test could even be seen as an indication of a continuation of the uptrend. Currently, this important line sits at $ 40,500.

Crossing Price Average Lines could give Bitcoin further boost

The chart analysis for the weekly candles also shows that the Bitcoin price could soon get a bullish signal if the average lines for the past 8, 13 and 21 weeks intersect. In the lower diagram, it can be seen that the orange line is currently very thin below the green and purple lines.

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In the previous bull market, the orange line was always above the other two lines. Exactly at the moment when the orange line crossed the other two lines from top to bottom, the strong correction was triggered in May 2021.

However, now the lines could cross in opposite directions, which would be considered extremely bullish. This event was last held in May 2020. At that time, Bitcoin was still trading at under $ 8,000 and could record an increase of more than 700 percent in the following twelve months.

But investors should still be a bit cautious. Because the bullish crossing of the lines has not taken place so far. Should BTC / USD correct strongly in the next few days, the lines could move apart again even before the intersection. In addition, there is a risk of a bearish cross shortly after the bullish crossing.

Such an event was last seen in January 2021. First, the orange line crossed the other spa average line from bottom to top. The Bitcoin price climbed from around $ 8,000 to more than $ 10,000 in just two months. But then, triggered by the corona crash on the financial markets, there was again an opposite crossing of lines. Within a very short time BTC slide down to under 4,000 dollars. A correction of around 60 percent.

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Bear Indicator 1: Low trading volume

The relatively low trading volume, which can still be seen despite the upward trends, makes us sceptical about the current bull run.

The daily candles show that the volume has been at a comparatively low level since March 2021. The increase in recent weeks has not significantly changed this. On the other hand, the trading volume was much higher at the beginning of the bull run in autumn 2020. This speaks for the fact that especially the large investors and institutional investors do not currently trade Bitcoin and other cryptocurrencies on a large scale.

Bear Indicator 2: Bitcoin reaches massive resistance at $ 46,000 to $ 47,000

A second indication of a potentially imminent correction in Bitcoin is the massive resistance hitting the BTC / USD on a further rise over the next few days. Because in the range of 46,000 to 47,000 dollars there is a strong buy/sell zone for BTC.

In February 2021, Bitcoin was able to climb above this price range for the first time and has repeatedly confirmed it as a new support zone until May 2021. However, the mid-May price slide took place at the exact moment BTC/USD slipped below this level. Therefore, some resistance of the bears is to be expected here. Bitcoin should therefore not easily skip this mark.

Should there be a rejection in this area, there could be a strong sell signal that will cause prices to slide a few thousand dollars in a short period of time. However, if BTC / USD actually manages to overcome this mark, this would be a confirmation of the strength of the bears. The next extreme resistance would then be expected only in the range of the historical highs of 58.000 to 65.000 dollars.

Bears Indicator 3: Big Rising Wedge could break

A third warning signal for buyers of Bitcoin is a large chart formation, which can be seen on the hourly candles of BTC/USD.

For example, the Bitcoin price has been in a rising wedge since June 9 and a price of around $ 32,500. The support line was successfully confirmed at lows of $ 29,000 on July 21, 2021, and most recently at $ 37,500, and Bitcoin subsequently continued its upward trends by more than 20 percent, or $ 8,000.

The resistance line of the rising wedge, on the other hand, was tested in the price range of $ 36,000 and $ 37,000, and last on the day of release at $ 46,000. The target range of the Falling Wedge is a maximum of $ 49,000. There is therefore a certain risk that Bitcoin will break out of this chart formation downwards in the near future, because basically the risk wedge is considered a bearish price pattern. The technical price target for the correction would be around $ 32,500 at the starting point.

Attention when trading Bitcoin

So whether the bears have really already given up and the bull market will continue in the next few weeks is by no means certain. A certain degree of caution seems appropriate in view of the warning signals described. Especially when trading Bitcoin and trading leverage, investors should be a bit cautious at current price levels with an eye to the imminent resistance, so as not to be swept out of their trade with a strong correction.