Bitcoin price is at a pivotal zone, nearing a potential point of no return for bulls. However, the weekend forecast could suggest sunnier skies are in the future, so long as BTCUSD holds above the weekly Ichimoku cloud.
Here is a closer look at BTCUSD weekly timeframes “at a glance” using the Ichimoku Kinko Hyo.
Bitcoin price is holding above the cloud | Source: BTCUSD on TradingView.com
Weekly Bitcoin Price Action At A Glance Using Ichimoku
Using nothing more than the naked Ichimoku chart above, BTCUSD weekly has touched and found support at the cloud – also called the Kumo.
The blue conversion line is above the maroon-colored base line, indicating the market is still bullish, but consolidating. A bullish trending market would see Bitcoin price trading above both lines.
Touching the cloud itself isn’t always significant. However, only weekly timeframes, retesting the same cloud is what kickstarted the bull run.
Flipping the Ichimoku cloud started the bull run | Source: BTCUSD on TradingView.com
Losing the cloud would be substantial. It could mean the bull cycle has finished, or that extended consolidation is ahead. The last time the weekly cloud was lost was the Black Thursday collapse in March 2020.
The Ichimoku is among the few technical indicators that focus on both time and price. Tapping the cloud means that it is time to look for other signals for more confirmation.
Three potential supporting reversal signals can be found | Source: BTCUSD on TradingView.com
With more technical indicators turned on, things get a lot more interesting. The TD Sequential market timing indicator has triggered a perfected buy setup, just as Bitcoin touches the cloud.
Sunday night’s weekly close could very well remain near current levels to end with a doji. How bulls react in the following week would be telling.
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A green up candle to above $47K would break through a local downtrend line and put a morning star Japanese candlestick pattern in play. It is worth noting, however, that the last potential weekly morning star setup failed. But such signals are only confirmed in hindsight.
At the same time, weekly Stochastic is exhibiting a bullish divergence. A bullish crossover is also nearing while at a reading that historically put in more significant bottoms than this.
What To Expect This Weekend Ahead of The BTCUSD Weekly Close
A doji candle signals indecision and come at the end of a trend, or at a pause before continuation. The fear in the market has left bulls weak and bull salivating, but neither have been able to make a major difference in the last five days.
The weekend forecast suggests more of the same level, with bulls needing to defend $42,000 and lower. Fear will likely keep bulls at bay until after the weekly close, when confidence returns and there is possibility of a morning star reversal.
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If the doji candle were to hint at continuation instead of reversal – the next logical target would be the bottom of the Ichimoku cloud at around $37,000.
Danger of more downside than that still exists. Bitcoin price just had a daily death cross which could have apocalyptic implications. Losing the Ichimoku cloud completely might indicate that the bull cycle has concluded for the time being. Reclaiming the cloud would be the first sign the bull run is back on.
Whatever you do, watch the clouds closely over the weekend.
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Featured image from iStockPhoto, Charts from TradingView.com
Source: https://www.newsbtc.com/analysis/btc/bitcoin-weekend-forecast-cloudy-with-a-chance-of-reversal/