Now that our target at the top of the bear channel is reached, the question is: Will we see a break-out of the channel or the anticipated last move down to the vicinity of $5600.
Whilst some analysts rightly claim, that there might still be a last leg up in current wave c, we would have to see if that entails a break of the channel on a weekly time frame, or whether we can expect a bearish pushback. There is some indication for the bearish case.
Whilst slightly increasing bullish volume and the fact that bears have not yet stepped in, forces us to be cautious in a short trade, we have to maintain our bearish bias for the market with our initial goal of the golden pocket of the last impulse wave up with significant fib levels and extensions converging as well as time cycles overlapping in the critical area.
Stay safe as this is a cutting edge trade and manage your risk accordingly. Please share and comment.
Whilst some analysts rightly claim, that there might still be a last leg up in current wave c, we would have to see if that entails a break of the channel on a weekly time frame, or whether we can expect a bearish pushback. There is some indication for the bearish case.
- First of all, the bear channel has held up quite nicely so far, it thus forms a valid level of resistance.
- Secondly, $BTC has reached the golden pocket of wave a, which is why we have seen many traders take their longs off the table.
- Thirdly, our indicator of choice, the Money Flow Index is well in the over sold area (even though volume remains low, implicating that this is in fact a corrective and not an impulsive move questioning the bullish scenario that the bottom might be in). MFI does give us some hidden bearish divergence on this time frame with higher highs on the MFI and lower highs within the channel.
- Lastly, our time and target analysis for this correction in relation to the single segments of the corrective pattern as well as to the impulse wave a of the higher degree suggests that there is still some room until the end of February for bears to play out the last leg.
Whilst slightly increasing bullish volume and the fact that bears have not yet stepped in, forces us to be cautious in a short trade, we have to maintain our bearish bias for the market with our initial goal of the golden pocket of the last impulse wave up with significant fib levels and extensions converging as well as time cycles overlapping in the critical area.
Stay safe as this is a cutting edge trade and manage your risk accordingly. Please share and comment.