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In this analysis, we analyze Bitcoin's weekly chart through the use of the indicator, and Bitcoin's tendencies to test levels through breakouts and pullbacks.
- To begin with, we look at the rally that took place in 2017
- Despite the steep , Bitcoin had phases of small corrections testing the support
- Such corrections took place even during a parabolic move in the form of a pullback
- As the trend started shifting, and prices fell below the indicator, we have seen the indicator get tested
- Breakouts took place during the way down, testing the resistance multiple times
- The same price movement had repeated during the recent and rallies
- Currently, we are trading way above the indicator
- Despite the overall trend being , a pullback to retest the support would indicate a 15% correction from current levels
Long short ratios are at 70 to 30, with significantly more long positions in the market. While this is a reflection of the sentiment, based on contrarian theory, this could be a concerning factor, considering the fact that billions had been recently liquidated.
What We Believe
The rejection we have faced at 12k regions also substantiate the argument that a corrective move in the form of a pullback is highly probable considering Bitcoin's past price movements.
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