BTC/USD Analysis – Here’s Our bitcoin playbook for May

Bitcoin has been moving sideways so far in 2022, ranging between $34,000 USD and $48,000. The flagship cryptocurrency’s $14,000 range could be about to break however, and we want to make sure our followers our ready for whatever scenario.

Bitcoin 1W Chart Overview

On the weekly chart the 50 through to the 500 moving averages are still in a bullish cross, a bullish sign for long term position traders. Price is also holding between the 50 & 100 moving averages, suggesting that we might see another push to the upside in the near future if traders defend the 100 week average.

BTC/USD 1W Chart, 27 April 2022

Bitcoin Seasonality – May usually bullish?

Is May a bullish month for Bitcoin?

Returns by month — outliers excluded. Source: CoinMetrics, daily bitcoin price data for 18/07/2010 to 31/01/2020.

Judging by the chart above… yes! Whilst there is a higher median in other months, May is typically a bullish month for Bitcoin. That’s why we’re favouring upside, but keep in mind we also do have a trade plan for if downside prevails!

The Bitcoin Playbook for May

Bitcoin has been trading in a bearish flag / ascending channel pattern in 2022. The recent leg has moved into the support trendline, where we are watching for price to either break or bounce.

As the chart displays, to go long we must see the previous structure broken and retested as a support zone. Alternatively if price breaks to the downside of the channel and has a prolonged correction then we will continue looking for downside into the $28,000 mark.

BTC/USD 4H Chart, 27 April 2022

What do you think is next for bitcoin? Let us know in the comments below!

Published by Tom Stewart

Head of data analytics at TradeProofer. Analyst at Opes Trading Group. FX enthusiast.

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