Anyone Buying the Dip in Bitcoin at the 50 SMA?

Bitcoin has retraced down today, but this might be a good chance to go long

Skerdian Meta•Monday, February 22, 2021•1 min read

Cryptocurrencies are retracing down today

Bitcoin broke above $ 40,000 on the last week of January, as the surge of last year spilled into 2021. Last week buyers pushed above $ 50,000, as the cryptocurrency surge continued further, helped by Eliot Musk who bought $1.5 billion worth of Bitcoin earlier this month. We did a broad Bitcoin analysis for 2021.

But, the main reason for this never-ending surge is the fact that the world is changing and it’s not certain which fiat currency is going to survive this. ETHEREUM broke above $ 2,000 last week, while Bitcoin moved above $ 58,000 yesterday, since the cryptocurrency market remains open during weekends as well.

Moving averages have been doing a great job during this time, providing support on pullbacks lower and pushing the trend higher. Today we are seeing one of those pullbacks in cryptocurrencies, with Bitcoin trading more than $ 5,000 lower. Although, it seems like sellers are thinking twice at the 50 SMA (yellow) on the H4 chart now.

This might be a good opportunity to go long on BITCOIN , since the stochastic indicators has reached the oversold area as well. But, the decline has been too fast and we don’t want to catch a falling knife. So, we will follow the price action to see if we can get a bullish reversing signal, such as a doji/pin/hammer candlesticks around here. If that happens, then that would be a sign to consider buying Bitcoin.

Update: Bitcoin broke below $ 50,000 just now, so be extra careful at the moment is you are trading cryptos

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ABOUT THE AUTHOR See More

Skerdian Meta

Lead Analyst

Skerdian Meta Lead Analyst. Skerdian is a professional Forex trader and a market analyst. He has been actively engaged in market analysis for the past 11 years. Before becoming our head analyst, Skerdian served as a trader and market analyst in Saxo Bank's local branch, Aksioner. Skerdian specialized in experimenting with developing models and hands-on trading. Skerdian has a masters degree in finance and investment.