BTC Price Outperforms S&P 500 This Week: Correction Coming for Both Assets? (April 9 Update)

The S&P 500 has performed extremely well over the past week, wiping out most of the losses caused by the dip from the Middle East Conflict, while Bitcoin did even better. However, with both at, or approaching, strong resistance, is it time for both to enter the next corrective phase?

Rejection next for the S&P 500?

Source: TradingView

The S&P 500 had a very strong last 7 days, and is up around 7% over the period. That said, after bouncing from the mid-line of the channel, the index has now reached firm resistance at 6,800. It would not be a surprise to see a rejection from here and for the index to come back down to perhaps break below the channel mid-line this time. This may depend to some extent on how things pan out for the current Middle East ceasefire.

Potential last spike then back to $69K?

Source: TradingView

The $BTC price has had a spate of higher highs and higher lows since the end of March, and this has helped to take the bulls almost to within touching distance of the bear market trendline. However, a couple of topping tails above the $71,700 horizontal resistance level bear testament to how the bulls may be running out of steam.

Of course, if there is some really good news out of the Middle East, the price would likely follow the stock market higher. That said, the same could happen in the opposite direction if the situation worsens.

As things stand, a quick spike up to retest the bear market trendline could occur first, and then a corrective phase down to at least the $69,000 horizontal support could be next.

RSI indicator rejection in daily time frame

Source: TradingView

The 50-day simple moving average (SMA) in the daily time frame is doing the job of providing support for the $BTC price, and it is also posturing to rise back up.

Counter to this is the RSI, which illustrates that the indicator line looks as though it is about to be rejected from the downtrend line. This would eventually be reflected in the price action, possibly causing it to fall down out of the bear flag.

Price direction for next couple of months about to be decided

Source: TradingView

In the weekly time frame it’s still all to play for, although it has to be admitted that the bears still have the upper hand as long as the price stays within the bear flag.

In contrast, the MACD reveals that the blue indicator line is still shaping to cross back above the red signal line. Will this change by the end of this week as bullish momentum potentially begins to falter? 

Things will have to go one way or the other in the next week or two, and the direction that is eventually taken could be the one that dominates for the next couple of months or more. Which will it be?

Disclaimer: This article is provided for informational purposes only. It is not offered or intended to be used as legal, tax, investment, financial, or other advice.