Good morning, traders. While the daily inside bar we were watching didn't pan out as such, the tweezer top that we noted did, so price isn't doing anything we didn't talk about potentially happening at this point. It looks like we are finally getting the pullback that we have been expecting with liquidated longs providing the continued fuel. This has produced a low of around $6850 so far, which is the equilibrium of the demand zone box and where price is currently stabilizing. As I have been stating, this is where I would like to see price rebound from. We saw the same thing happen from August 4th-6th, just in the opposite direction as price was dropping rather than rising. Upon a breach of that $6850 level, and close below it, I'm looking for a test of the bright green box between $6760 and $6800 (which is based on the 1H Bitfinex chart and provides support at the bottom of the demand zone). Below that, I will be watching the 4H demand box sitting between $6717 and $6749.
Currently, price is continuing to print a descending broadening wedge on the 4H as I pointed out last night, so the expectation is that this is just a pullback rather than an all-out reversal at this time. RSI is sitting on previous support which provided a $900 push in price last time. We have strong support showing on Bitmex and Bitfinex from $6750-$6810. Resistance starts showing up stronger around $6950. Traders should be watching the 4H MACD for hidden bullish divergence which is currently showing up strongly. However, we still have another 2 hours in this current candle and we would need to see the next candle heading higher to confirm the divergence. This pullback today is also saving the pair from a strong bearish divergence on the daily MACD's positive histogram, increasing the likelihood of continued upward momentum. On the 1D chart, I have removed the previous ascending triangle and am watching the higher resistance around $7100 as the possible top. When we first looked at it a few days back during the live stream, we initially thought about this level but ultimately went with the lower one because, as I pointed out at that time, it was the top of the demand zone. I still don't like all the white space at the beginning of this possible pattern, but volume continues to feed the narrative of a consolidation in this area as we near what would be the convergence of the support and resistance lines. As always, we need to see volume expanding as price breaches the resistance. While price remains above the ascending support line the pattern continues to hold true.
As I discussed a few days back during a live stream, and which I'll be looking at during this morning's live stream, BTCUSD price continues to move opposite the dollar index just like gold. The dollar index is printing multiple bearish patterns which it appears to be on the verge of falling through suggesting that Bitcoin should continue rising. Today, we are seeing the index rise and BTC drop. Remember, there are no guarantees in financial markets so until those bearish patterns play out we have to consider that the dollar index may continue to rise which should then see Bitcoin continue to drop in response.
Follow us on social media and take advantage of our limited number of coupons for a discount to the most comprehensive trading course around (TV won't allow us to advertise, but you will easily find our live streams I'm sure)! We teach everything from market psychology and risk management, to candlesticks and patterns, and are about to publish our advanced modules on Wyckoff, EW, delta footprints, & liquidity/demand/supply zones.
Currently, price is continuing to print a descending broadening wedge on the 4H as I pointed out last night, so the expectation is that this is just a pullback rather than an all-out reversal at this time. RSI is sitting on previous support which provided a $900 push in price last time. We have strong support showing on Bitmex and Bitfinex from $6750-$6810. Resistance starts showing up stronger around $6950. Traders should be watching the 4H MACD for hidden bullish divergence which is currently showing up strongly. However, we still have another 2 hours in this current candle and we would need to see the next candle heading higher to confirm the divergence. This pullback today is also saving the pair from a strong bearish divergence on the daily MACD's positive histogram, increasing the likelihood of continued upward momentum. On the 1D chart, I have removed the previous ascending triangle and am watching the higher resistance around $7100 as the possible top. When we first looked at it a few days back during the live stream, we initially thought about this level but ultimately went with the lower one because, as I pointed out at that time, it was the top of the demand zone. I still don't like all the white space at the beginning of this possible pattern, but volume continues to feed the narrative of a consolidation in this area as we near what would be the convergence of the support and resistance lines. As always, we need to see volume expanding as price breaches the resistance. While price remains above the ascending support line the pattern continues to hold true.
As I discussed a few days back during a live stream, and which I'll be looking at during this morning's live stream, BTCUSD price continues to move opposite the dollar index just like gold. The dollar index is printing multiple bearish patterns which it appears to be on the verge of falling through suggesting that Bitcoin should continue rising. Today, we are seeing the index rise and BTC drop. Remember, there are no guarantees in financial markets so until those bearish patterns play out we have to consider that the dollar index may continue to rise which should then see Bitcoin continue to drop in response.
Follow us on social media and take advantage of our limited number of coupons for a discount to the most comprehensive trading course around (TV won't allow us to advertise, but you will easily find our live streams I'm sure)! We teach everything from market psychology and risk management, to candlesticks and patterns, and are about to publish our advanced modules on Wyckoff, EW, delta footprints, & liquidity/demand/supply zones.