MagicPoopCannon

Candlestick Clues Suggest Rally, As BTC Holds Critical Support!

COINBASE:BTCUSD   Bitcoin / U.S. Dollar
The past two weeks have been an absolute war between the bulls and the bears in BTC . Thus far, BTC has managed to hold multiple converging support levels. If you've been following along with my analyses, we have been talking about how important this "do or die" area is for BTC . As you can see, the 7270 area has several converging levels of support. It has the lateral neckline of a head and shoulders pattern (red trendline ,) the 50 week moving average (in orange,) and the 61.8% Fibonacci retracement for the entire bull run from 3150 to 13800. Obviously, these are extremely important technical levels, and they all happen to be converging right now in the 7250 range.

I always like to look for clues in the candle patterns, and I may have found one. You can see that on September 19th, BTC printed a big hammer candle. Then, there were two small red candles after that, and then BTC plummeted about 25% before it found support. Look also at the MACD . You can see that when BTC printed that hammer and two down candles (purple circle) the MACD was forming a bearish crossover.

If we compare that to the most recent action, we can see that BTC appears to be doing the exact same thing, but in the opposite direction. You can see that there was a large inverted hammer , which was very similar to the hammer that was printed on September 19th. Since then, we had a small green candle yesterday, and it looks like we're printing another small green candle today. Furthermore, we can see that the MACD has printed a bullish crossover, while also forming a bullish divergence to price. So, the sell-side momentum is waning, and the candle pattern is looking very similar to what we saw in mid September.

When you factor those candlestick clues in with the bullish divergence on the MACD , and the fact that BTC is holding support above the aforementioned critical converging support levels, it suggests that BTC could enter a relief rally in the near future. IF that happens, I would be looking for initial resistance around the top of the falling wedge pattern (in dashes.) That would be somewhere in the 8500-8700 range.

The condition that would invalidate this analysis, is a sudden unexpected breakdown of BTC , with a daily candle closing decisively below the critical support level near 7250.

I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
Dec 08
Comment: I'm starting to think this analysis may have been invalidated. I was expecting to see a surge today, but BTC keeps showing weakness. BTC is in a symmetrical triangle right now, so traders should watch the direction of the breakout, and look for high volume for added confidence on that breakout direction.
any updates? @MagicPoopCannon
+1 Reply
Lol just waiting for all the people to be like "Ah man, you just flip flopped on us all again!!" To which I'd reply: And?? Hey, at least you DO that - i.e., are upfront about your ideas as they progress - as opposed to pig-headededly sticking to a position simply because "you said it." The longer I am in the markets, the more I learn how little "our feelings" seem to have with the whole thing.
+1 Reply
I'm starting to think this analysis may have been invalidated. I was expecting to see a surge today, but BTC keeps showing weakness. BTC is in a symmetrical triangle right now, so traders should watch the direction of the breakout, and look for high volume for added confidence on that breakout direction.
+6 Reply
Vision2077 MagicPoopCannon
@MagicPoopCannon, my triangle tip finishes december 10th, there is a rebound left.
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gjones15 MagicPoopCannon
@MagicPoopCannon, Agreed. Target: 6800
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Alex_B1M MagicPoopCannon
@MagicPoopCannon, seems your idea is still playing out... let'see, level holding pretty well. I'm expecting a run to low 8 really soon
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i agree. lets see where we are going ... 8800 my expectation.

+1 Reply
hey poop, even if we have a brief relief rally, still think we are in an overall bear trend?
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Poop must be a psycho, from saying price going to 1K, now he's totally reversed his outlook. You would have a better idea of price movement by throwing darts at the chart. Or maybe thats how poop works.
+1 Reply
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