Bitcoin Halving Ahead

bitcoin as a coin with a vertical line indicating the future halving of the reward
.12 Apr 2024
author avatar image Andreas Thalassinos

Table of Contents

Introduction – Bitcoin Halving Ahead

Bitcoin, a decentralized digital currency operating on a peer-to-peer network, has always been of significant interest to traders and investors alike. In this technical analysis report, we’ll utilize the Ichimoku Kinko Hyo indicator to provide insights into the current market conditions of Bitcoin. The Ichimoku Kinko Hyo indicator is renowned for its ability to identify trends, support and resistance levels, and potential entry and exit points. Bitcoin has historically demonstrated a tendency to rally and reach a peak within a year after its halving date. During this period, it has exhibited a number of exit signals, including negative divergence, failure swing reversal, and two consecutive closes beneath the 50-period moving average.

Technical Analysis

bitcoin price chart using ichimoku cloud analysis ahead of bitcoin halving

Tenkan-sen and Kijun-sen

  • The Tenkan-sen (9-period moving average) is trading above the Kijun-sen (26-period moving average), indicating a bullish sentiment in the short term. This suggests that buyers have been more active recently, supporting upward price movement. Traders may consider this bullish crossover as a potential entry point for long positions ahead of Bitcoin halving.

Senkou Span A and Senkou Span B

  •  Currently, the Senkou Span A is above the Senkou Span B, indicating a bullish bias in the medium term. This suggests that the price might face support around the Senkou Span A and, if breached at Senkou Span B, if a pullback occurs. Traders could consider these levels a potential entry point for long positions, anticipating a bounce off this support. The Senkou Span A (leading span A) and Senkou Span B (leading span B) form the boundaries of the Kumo Cloud (or Ichimoku Cloud). These lines project forward by 26 and 52 periods, respectively.

Kumo Cloud

  • As of now, the price of Bitcoin is trading above the Kumo Cloud, reinforcing the bullish sentiment. Traders looking for entry points might consider waiting for a pullback toward the cloud, which could offer a favorable risk-reward ratio for long positions. The Kumo Cloud represents an area of support and resistance. When the price is above the cloud, it indicates a bullish trend, while a price below the cloud suggests a bearish trend. 

Potential Entry Points and Take Profit Levels

Based on the Ichimoku Kinko Hyo analysis, potential entry points and take profit levels could be identified as follows:

Entry Point 1 (Short Term)

  • A bullish crossover of the Tenkan-sen above the Kijun-sen could serve as a short-term entry point for long positions. Traders may consider entering the market upon this bullish signal, with a target profit level near the recent swing high or resistance level: 72865 and 73865, respectively.

Entry Point 2 (Medium Term)

  • A pullback towards the Senkou Span B, accompanied by a bounce off this level, could provide a medium-term entry point for long positions. Traders might initiate long positions at this level, targeting the recent swing high or resistance level as the take profit level: 73865.

Take Profit Levels

  • Short-term traders may consider taking profit near recent swing highs or resistance levels identified on the price chart, 72865.
  • Medium-term traders could target higher resistance levels or utilize trailing stop-loss orders to capture potential extended gains, 73865.
  • Long-term traders could target higher price levels (i.e., 79075) or wait for two closing prices below the 50-period Linearly Weighted Moving Average to maximize potential profits.

Conclusion

In conclusion, the Ichimoku Kinko Hyo analysis of Bitcoin suggests a bullish outlook in both the short and medium terms. Potential entry points for long positions include bullish crossovers of the Tenkan-sen and pullbacks towards the Senkou Span B. Traders should carefully manage risk, consider utilizing appropriate stop-loss, and take profit levels to optimize their trading strategies. As always, it’s essential to monitor market conditions and adjust trading plans accordingly to adapt to changing dynamics.

author avatar image
Andreas Thalassinos

Experienced educator with a demonstrated history of working in the financial services industry. Skilled in Technical Analysis, Market Risk, Asset Management, Stock Market, and Trading Systems. Strong professional with a MSTA by Society of Technical Analysts (UK), CFTe and MFTA focused in Master of Financial Technical Analysis from International Federation of Technical Analysts (USA).