Many of you are probably wondering what that means. Well, an is a reversal formation. Typically, the candle that rises before the star, is completely erased on the other side of the . In other words, if this pattern plays out, next week could completely erase the gains that we have seen, since the breakout above the weekly 200 . I've shown in other analyses how we were just rejected at the top of a huge , and I've shown how we could return to the bottom of that channel. For clarification, see the previous BTC analysis linked below. This pattern is suggesting that we could see a fall to the bottom of that channel, and potentially even lower.
As I have featured in other analyses, you can see that there is a big nasty red arrow on the chart, showing how BTC could wipe out an enormous amount of value next week. That's because for this pattern to complete itself, we would have to see a powerful follow through on the reversal. Keep in mind, this pattern is NOT complete. However, it is set up perfectly to fulfill itself. The exciting part, is that if we do see an explosive retracement back to the 200 (in purple) next week, that might not be the end of the selling. In fact, evening stars often produce several candles of downside continuation on the back of the pattern. So, we will have to see how this plays out. I just wanted to bring it to everyone's attention, so that you all understand the potential downside risk.
The weekly 50 has stopped BTC dead in it's tracks. From this point, the most likely direction we will traverse, is to the downside in the coming weeks.
To anyone out there who is a pattern junkie, wondering how this is a "textbook" setup, without a gap up to the , I only have one thing to say — this is Bitcoin . It's a 24 hour market. There isn't a single gap on this chart. As a result, I have excluded that textbook requirement.
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***