Hello everybody!
I am here again with some update.
To my surprise bitcoin broke relatively easy through the psychological resistance of 6000 dollar. The resistance zone 5750 - 6000 was obviously not able to reverse the trend. Demand simply sucked up all the supply. I have almost no doubt in my mind that bitcoin is going to continue to march for the coming days. The question is when and more important which price will cause a trend reversal?
There are multiple resistance lines above bitcoin but I only drew one on the chart: 6500 USD (a wick to 6800 USD is possible). I don t see any other strong resistance lines. 6500 USD is the previous top. After hitting this last top bitcoin crashed to the low 3000. I support this idea because of several reasons. First reason is that bitcoin, in a major downtrend, always came back to the previous (lowest) top after a big dump and then reversed. Second the VPVR indicator shows highest trading activity around the 6.4 -6.5k zone. Third on the weekly chart the green candles are getting shorter and shorter, that means that the uptrend is weakening and topping out. When you draw a rising wedge on the daily chart it points to the 6.5k price. You see on the chart a parabolical uptrend which is getting very steep to the upside and will stop around that 6500 level followed by a huge red doji candle.
When bitcoin reaches that level and shows signs of weakness or a drop in volume then this will be a very good indicator that a true trend reversal will start! Another sign we need to check is a bearish divergence on the daily chart (price still goes up but tops RSI is going down). Weekly STOCH RSI and STOCH are in the overbought region for a very long time, when it points down then this will give another big sign that a trend reversal is in the making.
I am curious if there will be enough bulls at the 6500 level to break this line! The bears will be in the majority.
Thanks for reading and if you have some constructive and usefull comment please post.
Cheers
I am here again with some update.
To my surprise bitcoin broke relatively easy through the psychological resistance of 6000 dollar. The resistance zone 5750 - 6000 was obviously not able to reverse the trend. Demand simply sucked up all the supply. I have almost no doubt in my mind that bitcoin is going to continue to march for the coming days. The question is when and more important which price will cause a trend reversal?
There are multiple resistance lines above bitcoin but I only drew one on the chart: 6500 USD (a wick to 6800 USD is possible). I don t see any other strong resistance lines. 6500 USD is the previous top. After hitting this last top bitcoin crashed to the low 3000. I support this idea because of several reasons. First reason is that bitcoin, in a major downtrend, always came back to the previous (lowest) top after a big dump and then reversed. Second the VPVR indicator shows highest trading activity around the 6.4 -6.5k zone. Third on the weekly chart the green candles are getting shorter and shorter, that means that the uptrend is weakening and topping out. When you draw a rising wedge on the daily chart it points to the 6.5k price. You see on the chart a parabolical uptrend which is getting very steep to the upside and will stop around that 6500 level followed by a huge red doji candle.
When bitcoin reaches that level and shows signs of weakness or a drop in volume then this will be a very good indicator that a true trend reversal will start! Another sign we need to check is a bearish divergence on the daily chart (price still goes up but tops RSI is going down). Weekly STOCH RSI and STOCH are in the overbought region for a very long time, when it points down then this will give another big sign that a trend reversal is in the making.
I am curious if there will be enough bulls at the 6500 level to break this line! The bears will be in the majority.
Thanks for reading and if you have some constructive and usefull comment please post.
Cheers