The bulls have regained control in the crypto market, and we wonder if this month of May will be positive for the price of Bitcoin. Today we answer this question by making a brief situational analysis.
At the time of writing, Bitcoin is trading at $ 8,835, a price obtained after falling back from a bi-monthly high of $ 9,485.
During the month of April, Bitcoin managed to fully recover after its fall of more than 55% in March, and even generate profits.
Everything indicates that much of that return of interest is related to the proximity of the celebration of his 3rd Halving.
The information is more than exposed, both small and large investors know the very possible impact of the decrease in supply.
For this reason, the rise we are experiencing may be a way of discounting what is expected, a consequence of young and old who get on the wave for fear of losing it.
Bitcoin’s Halving is slated to occur in block 630,000, expected on May 12.
If most of the interest comes from investors trying to get on the wave for fear of losing it, chances are capital inflow will continue to happen as the event approaches.
All this bullish sentiment is the product of simple but solid arguments, and they are as follows:
- Increasing demand, decreased supply: Bitcoin is increasingly in demand. In this way, even if demand remains exactly the same as today, its price should increase twice, when the issuance speed is half.
- Miners who will not want to sell: And if to the previous situation we add miners who do not want to sell below the production price, being they who have the new supply, everything is aligned for a revaluation of Bitcoin
Bitcoin price at the beginning of May
A large part of what happens with the crypto market in the coming days will be related to the famous event. And to know with a little more precision where the price of Bitcoin could go, let’s go to the charts.
Technical analysis: Monthly temporality
When starting a new month, it is really helpful to review how you closed the candle for that time period.
The close of the April candle was extremely positive for the bulls, with a body that completely enveloped the March bearish attempt.
Despite the fact that in the graphs a large part shows in favor of a new fall, due to the predominant strength of the bears in March, on April 29, everything changed for the short term, after a strong bullish sentiment. With this, we see today a respect of the bullish crossing of the EMA of 8 and SMA of 18 months.
The monthly bullish trend line is validated with a 3rd touch in March, leaving strong rejection of low prices.
Now Bitcoin must overcome the downtrend line that locks the price in a flag formation; if broken, it can certainly be considered an excellent bullish signal for the search for new all-time highs.
On the weekly candle chart, the scenario is also positive. The 200-week moving average was rejected on the downside, and the bears were unable to break it.
The EMA of 8 and SMA of 18 currently bearish, were traded to the upside, so if the current trend continues, it is a matter of time for them to cross in favor of buy signals.
From this time frame, the signals are quite positive. However, the price of Bitcoin is reaching major resistances, so a deeper pullback could start at any time.
The 200-day SMA was traded higher on April 29, thus giving important buying signals for this May.
The EMA of 8 and SMA of 18 are crossed to the upside supporting the succession of ever higher lows seen in this season.
The price is rejecting resistance at $ 9,220, a deeper pullback could be starting. In any case, it is best to go in favor of the trend, currently bullish.
After the respite from the buyers’ profit-taking ends, the resistance zone between $ 10,300 and $ 10,500 could be visited.
If you want to invest in the medium and long term, this is a good time to do it, always trying to make purchases frequently, in order to average the best entry prices.
Bitcoin’s price in May promises to continue rising as a result of rising investor interest as Halving approaches. If we see it this way, it may be a good idea to invest for the short term, but remember, it is not often profitable to buy in resistors, so if you are more cautious, you would let the price take a deeper breath.
All our publications are informative, in no case should they be adhered to as investment advice.