With the recent plummet that not many people on tradingviewers expected, I felt like giving a perspective.
When the market plunged to $3200 and found support, many people believed that the final capitulation took place and that we'd see a steady rise back to the previous strong support of $6000.
Many traders, myself included, were waiting for a completion of an Inverse Head & Shoulders pattern and a possible subsequent bull rally. (Drawn on the chart)
However, as the formation of a right shoulder dragged on, the chances of an imminent complete IH&S became less likely.
I've warned traders and investors that we were still in a strong bear market and that trends are dominant over short-term patterns. That's why trend analysis should come before any short-term analysis like Head & Shoulders, Bear Flag, Ascending Triangle etc.
I've noted that we've been consistently creating lower highs and and lower lows.
I also gave warning regarding the lacking volume- stagnant or decreasing volume pushes price downwards. (Moving average drawn on the volume chart)
Unless you're strategically dollar-cost-averaging your capital and entering the market with calculated risks, it's dumb money.
We've been in a bear market for a year now and the trend shows that we're still in a bear market. I've loaded up the 100-MA (blue line) to make this point clear.
Many bullish investors believed that the $6000 support level wouldn't break. I myself thought that the horizontal movement we saw from September till November was a great accumulation zone. Many thought that it would be the start of an exponential rise.
We soon plummeted down -50% and found our next support level at $3200.
My point is, we don't know what's going to happen to the market. You have to understand that short-term price increase could be a fake out, that it could just lead to the market tanking further.
This $3000 support level is a key psychological level just like the $6000 support level and once it breaks, we could go down to $2000, $1000 or even three digits.
If you believe that BTC will one day surpass the high we created at the end of 2017, I suggest you take a deep breath, collect your thoughts, consider all scenarios.
When the market plunged to $3200 and found support, many people believed that the final capitulation took place and that we'd see a steady rise back to the previous strong support of $6000.
Many traders, myself included, were waiting for a completion of an Inverse Head & Shoulders pattern and a possible subsequent bull rally. (Drawn on the chart)
However, as the formation of a right shoulder dragged on, the chances of an imminent complete IH&S became less likely.
I've warned traders and investors that we were still in a strong bear market and that trends are dominant over short-term patterns. That's why trend analysis should come before any short-term analysis like Head & Shoulders, Bear Flag, Ascending Triangle etc.
I've noted that we've been consistently creating lower highs and and lower lows.
I also gave warning regarding the lacking volume- stagnant or decreasing volume pushes price downwards. (Moving average drawn on the volume chart)
Unless you're strategically dollar-cost-averaging your capital and entering the market with calculated risks, it's dumb money.
We've been in a bear market for a year now and the trend shows that we're still in a bear market. I've loaded up the 100-MA (blue line) to make this point clear.
Many bullish investors believed that the $6000 support level wouldn't break. I myself thought that the horizontal movement we saw from September till November was a great accumulation zone. Many thought that it would be the start of an exponential rise.
We soon plummeted down -50% and found our next support level at $3200.
My point is, we don't know what's going to happen to the market. You have to understand that short-term price increase could be a fake out, that it could just lead to the market tanking further.
This $3000 support level is a key psychological level just like the $6000 support level and once it breaks, we could go down to $2000, $1000 or even three digits.
If you believe that BTC will one day surpass the high we created at the end of 2017, I suggest you take a deep breath, collect your thoughts, consider all scenarios.
Comment:
The market is making horizontal movement. This inaction could easily turn into another plunge. Be careful!