SML Advisory Newsletter - Featuring Bitcoin Technical Analysis

Bitcoin Technical Analysis Newsletter - January 22, 2025

Welcome to Your BTC Technical Analysis Update,

As we navigate through the first weeks of 2025, let's delve into the current technical analysis (TA) patterns for Bitcoin (BTC), which remain pivotal for understanding potential price movements in the near term. One could make a case for each of these patterns listed below. However, I like to keep things as simple as possible, so I am going to highlight the fact that the downtrend line from 12/17/24 to 1/15/25 has been broken and retested twice. However, a trend reversal is not confirmed until the old ATH has been taken out and closed above. In this case 106,146 on the daily chart.

Current Patterns to Consider:

1.        Ascending Triangle on Daily Chart:

1. Bitcoin has shown signs of forming an ascending triangle pattern, a classic bullish continuation setup. This is characterized by a flat resistance at around $108,000 and an ascending support line. If Bitcoin decisively breaks above this resistance, we might see a significant upward move. However, a failure to break out could lead to a retest of lower support levels.

2.        Rising Wedge Pattern:

2. Some analysts have identified a rising wedge pattern, which can be tricky as it might signal either a continuation or a reversal. The key here is watching the major support line near $92,000. A breakdown below this could indicate a move towards lower levels, potentially testing another support around $72,000.

3.        Ascending Broadening Wedge:

3. Bitcoin has also been trading within an ascending broadening wedge, with the price holding above $91,000, suggesting a battle between buyers and sellers. A breakout from this pattern could dictate the short-term direction; upwards for a bullish confirmation or downwards for a bearish correction.

Conclusion:

There's a mixed bag of indications with bearish signals on shorter timeframes due to divergences and consolidations, yet the long-term outlook remains bullish from a technical standpoint. The short-term TA will turn positive as soon as the old all-time high is breached and there is a close above 106,146 that can hold this level for more than 24 hours.  When this happens, it will signal the start of the next up trend.

Disclaimer: This newsletter is for educational purposes only and should not be considered as investment advice. Before investing in Bitcoin and other cryptocurrencies, carefully consider all the risks associated with these investments and consult a licensed investment advisor.