FX.co ★ Trading Signal for BTC/USD (Bitcoin) for May 20 - 21, 2021: Buy above $40,000

A combination of bearish factors resulted in the 54% correction in recent days. For example, earlier this month when US Treasury Secretary Janet Yellen and Securities and Exchange Commission Chairman Gary Gensler expressed their concerns about the cryptocurrency sector.

Besides, negative comments came from Elon Musk. Chinese trade associations warned about investing in cryptocurrencies. This undoubtedly spooked crypto investors and the market liquidated to the 1/8 murray level around $ 29,701 correction of more than 50%.

The fall to $29,701 on May 19 makes us think that the market has established a very strong bottom and it is likely that it will try again to test this strength when it does a double bottom or triple bottom. Only then we have a long-term bullish perspective.

On the 1-hour chart, we note that BTC is trading above the 21 SMA and above the 2/8 Murray key support level. As long as BTC is holding above these levels, a bullish move to the zone of the EMA 200 is in the cards.

The BTC chart shows that the crypto is ready to challenge the $4,7250 zone in the short term. We also notice the formation of a shoulder head shoulder pattern. As long as you trade above 2/8 ($37,500), your target will be $47,250.

The technical reading of the eagle indicator is giving a bullish signal and has some ground to cover up to overbought levels. This indicator also shares the idea that BTC will continue its technical rally.

Our recommendation is to buy right now above 40,191 and above 37,500, with targets at 43,750 and 47,250.

Support and Resistance Levels for May 20 – 21, 2021

Resistance (3) 49,213

Resistance (2) 47,581

Resistance (1) 44,590

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Support (1) 38.897

Support (2) 33,645

Support (3) 30,774