IBIT: Bear Stacked, Hitting The Bounce (Technical Analysis)

Summary IBIT has sold off over 15% in the last month, as Bitcoin broke from stocks and gold, and saw its moving averages turn into a clean bearish stack. Technically, the bears are reigning in both the one and six-month ￰0￱ chart suggests buying now is catching a falling knife. IBIT's current level of 58 is a pivot point, with a recent bounce off 57 providing a temporary floor for a bounce, but is potentially a bull trap. A break below 57 could go as low as 55 before hitting resistance, and bulls will need a break above 63 in order to resume the rally definitively.

It's rare that I see a chart that makes me want to write about Bitcoin ( BTC-USD ) and by extension its most-liquid ETF, the iShares Bitcoin Trust ETF ( IBIT ), but then I saw this chart, showing Bitcoin's recent divergence from both stocks and ￰1￱ July, Bitcoin (via IBIT, purple) has actually fallen 2%, after rallying to a high of over 15%, while stocks (via SPY , green) grind up 10%, and gold goes on its own roller coaster, up over 25% before ending up still 19% ￰2￱ was a decoupling that took ￰3￱ by YCharts Nobody said (or should've said) that the crypto ride would be easy, I suppose, but I began to wonder what how far IBIT could fall given that other risk assets like stocks were still doing alright, and gold has been acting much like a risk-on asset this year, moving alongside ￰4￱ one-month chart is brutal, down over 15%.

Data by YCharts For dip-buyers, what a ￰5￱ get to keep buying the dip, and the next dip too! In all seriousness, long-term believers in Bitcoin may rejoice that we're back to $100K, or around $58 in ￰6￱ where do we go from here? IBIT Hourly Chart Technical Analysis Here's the one-month chart with one-hour ￰7￱ same chart as the one above, but just IBIT and my preferred indicators; the legend is at the ￰8￱ I'll get straight to it, it looks pretty ￰9￱ downtrend is clear, and the EMAs are bare ￰10￱ 20/50/100/200 (blue, yellow, purple, maroon) are all sitting on top of the other, following a death cross on Oct. 16th. A death cross is where the shorter moving average falls below the longer moving average, e.

g., 50 EMA (yellow) crossing under 200 EMA (maroon). See where the yellow crosses down under the maroon line a few weeks ago. I tend to ignore the 20 EMA (blue) for reversal crosses, as it can be a little noisy and its crossovers, like Oct. 28th, can be short-lived bull traps. 57 was a clear bottom that triggered a bounce and an immediate gap ￰11￱ this may represent a psychological end after this bound structural support, it should note that its subsequent rally petered out when it was capped off by the 20 EMA (blue). Momentum is turning positive, though still neutral, and without a clear break to the upside that would take us above 60, momentum indicators like the RSI and MACD are signalling a bear ￰12￱ last few sessions do not look like a real rally or sustained move, and look still dominated by the technical ￰13￱ Case Without a break above 63, there is no continued ￰14￱ so, IBIT traders are essentially hoping for bullish volume to kick in to break above the 50 EMA (yellow).

This could create a larger reversal pattern, and a break above the 200 EMA at 63 is necessary to regain upward ￰15￱ would likely trigger a Golden Cross, the opposite of the Death Cross, the 50 EMA crossing over the 200 ￰16￱ would be a clear, but lagging, buy signal to get into the ￰17￱ chart offers little other hope for bulls other than a reversal from positive buying pressure, ￰18￱ is hope that 55 could offer structural support below 57, but that would require us to retest 57 again to find out if it is real or if the bounce is a bull ￰19￱ Case This is a classic bearish continuation, and bears should consider that right now the trend is their ￰20￱ the rip above 60 could be fruitful, as the current rally seems to have few legs, and anymore it does grow are likely to be crushed by the continued cell ￰21￱ for any sort of bullish breakout with the EMAs, but otherwise, this thing looks sick.

Ultimately, the chart currently favors a sell until 63 is obtained and ￰22￱ it is likely to fall again, it will retest 57. A break below that would be a sell down to ￰23￱ Daily Chart Technical Analysis However, we're talking really short-term here, and this advice on the 1-month chart is really just for traders. Let's take a look at the 6-month chart with daily candles: Barchart The last daily candle marked a low on the chart, and both ended with their bodies below the 200 EMA (maroon), which is an ominous ￰24￱ momentum indicators are turning over, with the 20 EMA (blue) falling down below the 50 EMA (yellow) and 100 (purple), now heading toward the 200 ￰25￱ this timeframe, we have bearish momentum, although we may be rolling over in the MACD into a bullish cycle, though again, this could be the bull trap in the ￰26￱ lower lows over the last month has really broken the cycle that IBIT was in before, and it's unclear from the chart where a real bottom is ￰27￱ may be hitting a bounce, especially since the current levels in IBIT correspond to the $100K psychological barrier from Bitcoin itself, but buying now for a short-to-medium term bounce is trying to catch the falling ￰28￱ could work out, but you're buying into heavy selling pressure volume-wise, and little bullish momentum, almost ￰29￱ bounce we saw off 57 was a low-volume move so far, and so until a greater rally materializes, this may be just a stalling move before the next leg ￰30￱ Ultimately, IBIT bulls have little to look forward to in the chart, with the bleakest picture I've seen in a hot minute for Bitcoin at large.

However, it's times like these where the technicals say run away that Bitcoin and IBIT by extension can turn things ￰31￱ is a hint of a turning over in technical momentum, and if IBIT can climb over the next few weeks to hit 63 and above, it could run out as far as 68-70 before hitting the next big resistance. However, the bears have been winning this past month, dragging IBIT down 15% while gold and stocks both stay afloat, and it shows little sign of stopping now. 57 proved to be a solid resistance point, but it marked a lower low, and a new six-month low for ￰32￱ below this point could easily give way to 55 before another resistance is ￰33￱ should consider IBIT very carefully, as it is positioned as a falling knife right ￰34￱ who are right may be rewarded with this selloff being seen as a bounce in the future, but they are fighting the trend, and must be wary of doing so.

I am staying away from adding any more exposure at the moment, although I am usually an observer, rather than a participant, in most crypto matters these ￰35￱ for reading.