Volatility has back in the Bitcoin market after the halving of Bitcoin cash (BCH) and Bitcoin Satoshi Vision (BSV). Bitcoin has made a high of $7450 and then suddenly back to $6800. Yesterday Bitcoin again made an upward move to $7150 but that not last long and the price is now trading around $6800.
The weekend dump is maybe due to Whales that are making a profit with leverage trading. The volume on the weekend is usually low and whales take advantage of that.
Bitcoin Daily 50 MA Resistance Tested
Bitcoin is now in an ascending channel and the price respected the support and resistance zones. Bitcoin price has tested the daily 50 MA (Moving Average) resistance on 7 April. The price is rejected from the 50 MA at $7450.
The second attempt to break the 50 MA resistance was yesterday when price pumped to $7150 and after rejection, a quick sell-off push the price to $6550 where the bottom of the ascending channel lies. Bitcoin is now trading around $6800.
The 50 MA resistance needs to be broken and bulls will again aim for that. If Bitcoin is able to break the 50 MA resistance and stays above it the next resistance will be 200 MA that is now around $8000.
RSI Following the Same Pattern
The relative strength index (RSI) on the daily chart looks similar to the previous rally. On 17 December 2019, the RSI value on daily chart fall below 30 and after that a small bull rally has started that pushed the price to $10,500. The rally has started from $6500 and Bitcoin gained around 50% of its value in just 2 months.
On 12 March the RSI falls below 30 and makes a bottom of 15.62. RSI below 30 means the assets are highly oversold and RSI above 70 means the asset is highly overbought. Bitcoin’s current RSI is around 50 and the price can increase further from there. As you can see in the chart the RSI is making an uptrend and respecting the trend line that means Bitcoin will see another move in the upside.
Bitcoin Cash (BCH) and BSV Miners Shifting to Bitcoin Network
Bitcoin cash (BCH) and Bitcoin Satoshi Vision (BSV) block reward halving are completed and reward per block for both is now 6.25 coin. After the halving of BCH and BSV, the miners are shifted to the Bitcoin network because Bitcoin is more profitable than both of the coins.
Bitcoin block per reward is now 12.5 BTC that will be reduced to 6.25 BTC after the halving (expected on 10-13 May). Miners want to grab as much as Bitcoin they can before the halving. The block reward will be 1/2 after the halving that will double the cost of bitcoin mining (if the hash rate and the difficulty remained the same).
There are two options for miners after the halving. First is to leave the bitcoin network and choose another coin that is profitable and minable with the same hardware. Small miners will choose this option and they will exit the bitcoin mining after halving. The second option is to continue mining the Bitcoin and reduce the selling pressure of the market that will push the price higher and ultimately they are in profit. Big miners choose the second option and they stop selling their mined BTC daily and wait for the price to climb up.
Bitcoin Hash Rate and Mining Difficulty Increasing
The mining difficulty is back on track after a huge drop on 26 March. The mining difficulty is decreased by more than 15% on 26 March because many miners left the network after the epic drop in price on 12 March.
Now the BCH and BSV miners joined the network and the hash rate is now 115.42 EH/s and increasing. The current mining difficulty is 14.72T and the next estimated mining difficulty is 15.96 T which is 8.46% more than the current value. The next mining difficulty will settle in 6 days 18 hours (20 April). The All-time high mining difficulty was 16.55 T reported on 9 March 2020.
If Bitcoin is able to close above the daily 50 MA resistance and the weekly candle above $7100 it will be bullish for the coming weeks. The price will then touch the 200 MA resistance around $8000. With the increasing number of miners and mining difficulty Bitcoin may see a rally toward $9500 before halving.
Bitcoin is unable to break the 50 MA and weekly resistance zones in the first try. If the price will drop more $6500 is a must hold point for Bitcoin, if Bitcoin unable to hold the support zone then we will again see Bitcoin in the range of $5000-$6000 where a lot of investors are waiting to fill their bags.