Bitcoin trend analysis – The $16,000 mountain expects a healthy pullback first

Bitcoin trend is currently neither in the bullish nor bearish territory as traders look for exact directions. Despite the BTC price pushing towards the upper end of the ascending price channel, traders are optimistically cautious about the overstretched bullish rally on the daily chart. As BTC/USD moves past $15,750, pro traders are concerned about the momentum since waning volume can bring down the house of cards.

In the past few weeks, the Bitcoin price moved spectacularly from $11,950 to touch a high of $15,950. After completing a strong performance, it is quite natural to expect the chart to cool down before starting the next rally. BTC/USD chart shows a 35 percent rise in the last 30 days alone, and pro traders believe that the price now needs a decent pullback.

On the macro front, there has been no overtly negative news to send the alarm bells ringing. As Bitcoin trend oscillates between $15,000 to $16,000, it is getting tough for the investors to make an investment decision. The overstretched technical indicators further complicate matters.

Crypto Fear and Greed Index – Extreme greed demands a cooldown

At present, the ‘Crypto Fear and Greed Index’ displays a reading of 90, which corresponds to levels of extreme greed. When readings are high, traders expect the market to correct and usually go short or take profits.

A mix of data from on-chain sources and crypto exchanges shows that there won’t be an imminent blow-off. Willy woo, a famous crypto analyst, says that traders won’t go short immediately, and there would be a minor correction in the BTC/USD chart. The ‘Long-to-Short’ ratio further explains how the Bitcoin trend situation might play out in the next few days.

The ‘long-to-short ratio’ of top traders further sheds light on the probable Bitcoin movements. The data shows that trades are being made as per price movements and not predictions. Compared to Binance, OKEx traders behaved differently and waited for a few days before jumping in on the current BTC rally. Such a cautious strategy may seem safe but hurts the asset’s momentum, which resulted in multiple rejections from the $15,600 level.

With Bitcoin trend indecisive, the best trade is not to trade at all

Despite the overbought technical and an impending correction, the loss in trader confidence is evident. Be it bulls or bears; both sides are awaiting clear signals from the charts. There are excessive long positions, and the market sentiment may change abruptly.

When facing mixed indicators, it is best to sit on the fence. Not trading at all is sometimes far more profitable than trading to lose. Besides, one can always jump in when a new trend starts.

Bitcoin trend analysis – $16,000 is proving to be a massive hurdle for the bullish Bitcoin trend

The resistance at $16,000 on the weekly charts proves to be a massive hurdle for the bulls. BTC/USD may touch new highs in the week ahead, but the bulls will have to be cautious. A minor correction towards the lower support at $15,100 would be healthy as it would strengthen the bullish resolve with accumulation stages.

In case of a correction, the weekly support levels at $12,000 must remain under observation. Such a vast correction, around 30 percent, would undoubtedly attract large bears into the mix. However, a long-term bullish perspective would remain relevant as such corrections are standard for the BTC/USD pair.

This week looks more or less range-bound. If the present support at $15,200 gives away, we can see $14,600 on the charts. In the past few days, the 50-day EMA has held up pretty well, especially during the abrupt short-term corrections on the hourly timeframes. The bearish volatility was quickly arrested by 50-day EMA. So, the $14,900 mark is likely to defend any wild movements in the BTC/USD pair.

What’s next for the Bitcoin trend?

A minor correction is a highly likely scenario to tone down the overbought charts. Such a healthy remedial movement would signify price stability and reflect BTC’s maturity as an asset. It would also show an organic chart build-up instead of a consistent parabolic move.

Bitcoin trend analysts or traders should not expect a substantial red candlestick. Instead, more prolonged sideways movement is the most probable scenario. The range-bound movement will compress the Bollinger Bands and also save liquidity and volume. The resultant compression will further set up the ground for an upcoming, possibly bullish trend. Compressing Bolling Bands are usually a good sign for the bulls to attempt a breakout.

On the other hand, altcoins should also expect an uptrend when the Bitcoin correction finishes. Historically, the months of December and January have proven to be great to purchase altcoins. If a BTC pullback does happen, traders must keep a keen eye on the altcoins as well.