Does Elon Musk push bitcoin with his tweets or does crypto make the businessman tweet?

Elon Musk bitcoin

The real question is whether Bitcoin’s pullbacks can be anticipated.

Much is said about the volatility of Bitcoin and market criptomonedas in general, in fact, even those who have not invested will be exposed to the idea of the volatility that exists in these markets, but not for this, could not take advantage of price cycles to withdraw a percentage of profits in a timely manner and have more profitable entries in the market.

In recent weeks, the setbacks that Bitcoin presented have been attributed to Elon Musk’s tweets, but is it the businessman who moves the market or is it the cryptocurrency that prompts him to publish a tweet?

Musk’s tweets

On February 20, he declared after an interaction on Twitter with Peter Schiff, that the price of BTC (BTC) and Ethereum (ETH) seemed somewhat high to him.


On February 22, a 7-day bearish rally would begin, going from a maximum of 58,367 to a minimum of 43,016 dollars (-26.51%).

On May 12, Musk shared a screenshot on his Twitter feed about suspending the purchase of Tesla vehicles with Bitcoin.

That day, the lowest price of the most famous cryptocurrency in the world was 48,500 and it would close at $ 49,498.77, this is -12.78% compared to its opening price of $ 56,753.19.

On June 3, the CEO of Tesla published a meme, hinting at a break with bitcoin expressed with the heartbroken emoji.

This day, Bitcoin would present a 5% retracement (-2,098 dollars).

The graph

Bitcoin

In this first image we see the historical maximum (ATH) at $ 64,899 reached on April 14 with a minimum of $ 28,800, a level that would become support on December 31 and on which it would “retest” on January 22 and 27. The 3 important setbacks presented in this rally are also pointed out.

Setbacks

  • February 22 (-26.51%)

Before the bearish rally (-26-51%), the graph indicated that from February 8 to February 21 the price had reached the “Overbought” level, according to the RSI andStochastic indicators. At the same time the Fisher Transform indicator showed a price reversal. Despite the price rise, the volume was not above average, indicating little interest in the market to push the price at that time to new highs.

When the price enters the overbought level, the market can project a bearish scenario in the time period analyzed. Likewise, the reversal that was presented in the Fisher Transform indicator could be considered as a point to value the withdrawal of profits or a percentage of these.

In Trading, the confirmation of the price action for the bearish scenario would be a good entry point for SHORT operations, generating profits with the depreciation of Bitcoin.

  • April 14 (-27.51%)

Source: Trading View

As in the February retracement, both the volume and the RSI and Stochastic indicators would give us the parameters to consider a new retracement, this time from the projection of a Bearish Divergence.



Projecting a trend line -in red color- on the maximums created on February 21, March 14 and April 14, and the same for the maximums in the RSI indicator, we see that in the price these maximums were “ Higher Highs ”while the peaks on the RSI were making“ Lower Highs ”, it is this disparity that is known as Regular Bearish Divergence, and it is an indicator of price retracement.

  • May 10 (-49.62%)

Source: Trading View

In addition to the retracement indicated by the bearish crossover in Fisher Transform and the decline in the RSI, projecting the Fibonacci Channels we could detect the downtrend that began on April 14.

Source: Trading View

At the same time that the RSI and Fisher Transform showed an exit signal on May 10, it could be seen that the price would not be able to overcome the resistance of the Fibonacci Channel.

  • June 3 (-49.62%)

Currently, within the Fibonacci channel 1 ( 46960.44 ), a price pattern called“Symmetric Triangle” would start from May 19.

When a breakdown of any price pattern occurs, both in the support or resistance level, it is necessary to wait for price confirmation before taking any action such as opening a position ( trading ), taking profits or entering the market, since the supports and resistances They are tested again for price, as happened after the breakout, without finding support in the Fibonacci channel and not at the upper end of the symmetrical triangle, where both supports would interact .

Prior to each Elon tweet, the graph promptly indicated when the setbacks would occur, opening the possibility that after the confirmations of each setback they motivated him to send the tweets.

Nowadays

According to the theory of the Symmetric Triangle, Height can represent the growth or fall of an asset, depending on the breakdown of the pattern. If the breakout occurs at resistance, and manages to find support, we can expect growth above $ 49,000 and if the breakout occurs at support, the decline could drive the price to support below $ 22,000 .

It should be noted that such movements are not abrupt and previously created supports and resistances are tested again, so the setbacks are healthy market movements, since new supports are created for an asset that grew parabolically. Recall that the historical maximum of 2017 was ~ $ 20,000 and this level would not be exceeded until December 2020, achieving a growth of $ 44,895 ( + 224.60% ) in less than four months.

The “Market Sentiment”

Even when there is no confirmation of a Bear Market or Bear Market, there is uncertainty of the continuation of the Bullrun given the percentages of the retracements, the Fibonacci channel on which it is interacting and the symmetric triangle pattern in which the price.

This same uncertainty is what causes more attention to be paid to negative news such as the Bitcoin ban in China (again), or the aforementioned setbacks being attributed to Elon Musk creating by the level of FUD -Fear, Uncertainty, Doubt- and positive news is overlooked such as the announcement by the president of El Salvador, Nayib Bukele, about the acceptance of Bitcoin as a legal tender in the country, or the presence of Bitcoin in the Indy 500.

If the positive news had occurred while Bitcoin surpassed all-time highs, the price would have risen further, adding to the FOMO – fear of missing out -, without a doubt, the interpretation and importance of conducting your own technical analysis is key for your investments and afternoons are more profitable.

In addition to the efforts of institutions such as the Mexican Exchange MEXO, who have free and live courses for traders, investors and enthusiasts from beginner to intermediate level, thanks to the democratization of information we have at our disposal pages, documents, videos and podcasts with tips and advice for those who want to learn and polish their skills.

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