Bitcoin technical framework suggests the context is still bullish. Yes we dropped 10% yesterday, however, keep in mind that the Inverse H&S pattern is still valid. Bitcoin didn't close below the left shoulder and held $3,560. Much price manipulation happening with trading bots and it definitely makes technical trading more difficult. But all we can do is trade with the known probabilities and use proper risk mgmt to protect our capital. If I'm bullish I always lay out the reasons why, but also provide a bear strategy so we protect our gains or limit our losses.
Bull context:
IHS pattern is still valid. The neckline isn't that far away.
We are trying to break out of the bear flag.
If we break above the neckline I fully expect we go to 4.5k. find a little resistance there and complete this pattern target at around 5.5k-5.8k (this is best case scenario).
Bearish context:
On the daily chart time-frame we punctured through the 50 DMA. It is now pointing down suggesting the bears are still in control of the medium term trend.
The 200 WMA is sitting at 3.2k. If we close below $3,560 on the 2hour chart time frame expect us to retest this level. If we break below 200 WMA and don't do a double bounce off the Dec low of 3.1k...expect bad, wait very bad things to happen.
Volumes are weak. Bulls have not stepped in yet big time to buy around 3.6k.
Right now it's easier being a bear vs. a bull. I'm still bullish, but not as confident as before. I still think we have an opportunity to complete this IHS pattern to a target of 5.5-5.8k but the longer we range trade the lower the probability.
So patience is the key right now. If you don't have positions (I sold my holdings in this recent dip for a nice gain) we only have two options:
1) There is a counter-trend buy opportunity if we break above the 50 DMA. I have listed this area on the 2 hour chart frame. This is a high risk trade and if this happens I expect we go to the neckline. Now if we break the neckline I don't know. We'll have wait and see how BTC behaves.
2) We wait for better prices to buy lower. I will be closely watching how BTC reacts at the 200 WMA (3.2k level). If BTC responds strongly (double bounce area) I will go long. I will not buy if btc closes below 3k on the 2hr chart frame. I will be shorting.
Trade safe and hope this chart is clear. If you like my content please smash the like button and follow. It motivates me to keep doing this.
Would love to hear your thoughts and suggestions.
Bobby
-Don't hate the hair, hate the game
Bull context:
IHS pattern is still valid. The neckline isn't that far away.
We are trying to break out of the bear flag.
If we break above the neckline I fully expect we go to 4.5k. find a little resistance there and complete this pattern target at around 5.5k-5.8k (this is best case scenario).
Bearish context:
On the daily chart time-frame we punctured through the 50 DMA. It is now pointing down suggesting the bears are still in control of the medium term trend.
The 200 WMA is sitting at 3.2k. If we close below $3,560 on the 2hour chart time frame expect us to retest this level. If we break below 200 WMA and don't do a double bounce off the Dec low of 3.1k...expect bad, wait very bad things to happen.
Volumes are weak. Bulls have not stepped in yet big time to buy around 3.6k.
Right now it's easier being a bear vs. a bull. I'm still bullish, but not as confident as before. I still think we have an opportunity to complete this IHS pattern to a target of 5.5-5.8k but the longer we range trade the lower the probability.
So patience is the key right now. If you don't have positions (I sold my holdings in this recent dip for a nice gain) we only have two options:
1) There is a counter-trend buy opportunity if we break above the 50 DMA. I have listed this area on the 2 hour chart frame. This is a high risk trade and if this happens I expect we go to the neckline. Now if we break the neckline I don't know. We'll have wait and see how BTC behaves.
2) We wait for better prices to buy lower. I will be closely watching how BTC reacts at the 200 WMA (3.2k level). If BTC responds strongly (double bounce area) I will go long. I will not buy if btc closes below 3k on the 2hr chart frame. I will be shorting.
Trade safe and hope this chart is clear. If you like my content please smash the like button and follow. It motivates me to keep doing this.
Would love to hear your thoughts and suggestions.
Bobby
-Don't hate the hair, hate the game