In the early American session, Bitcoin (BTC / USD) is trading above the psychological level of $40,000, forming a symmetrical triangle in 1-hour charts, with upside potential in the short term up to the zone of 200 EMA.
According to JP Morgan analysts, they have pointed to the fair price of Bitcoin based on a BTC volatility index, at $35,000. However, it is difficult for BTC to stay at that price, due to the strong demand it has. Besides, more and more companies are including BTC in their corporate investment portfolios. We believe that the fair value could be about the $100,000.
The most popular digital token is very volatile and prone to both panic and euphoria. So, its price has no limits when rising and falling. Hence, we must consider this digital asset with a lot of volatility and operate very carefully.
On the 1-hour chart, Bitcoin is consolidating above the strong 2/8 murray support located at $37,500, as long as BTC remains above this zone it could continue climbing to the 200 EMA located at $45,077.
Conversely, a price below $37,000 could have a bearish move to the $30,000 level and could form a double bottom, thus demonstrating the strong support and rebounding again. Therefore, below 2/8 of a murray we recommend selling up to 1/8 of a murray around $31,250.
The moving average of 21 also adds support to BTC. As we noticed, in recent days it has been bouncing above this area. So, we believe that there is a good opportunity to buy Bitcoin with targets at $45,000. A break above the 200 EMA can open the way to the psychological level of $50,000.
The eagle indicator in 1-hour charts, is showing overbought levels. A retracement of the BTC is likely in the next few hours to the support zone of $37,500, suggesting buy positions.
Support and Resistance Levels for May 21 – 24, 2021
Resistance (3) 47,581
Resistance (2) 46,321
Resistance (1) 43,125
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Support (1) 39,467
Support (2) 35,811
Support (3) 33,645