This is an entirely hypothetical chart, and it is FAR too early to make predictions like this. But...
Volume is dropping, and we are currently curving out and away on a lower high. This has come off a drop below the short term rising trend line. That is to say, we have all the ingredients of a Head & Shoulders pattern.
Is this the end times; or will the bulls break out?
Thanks for posting. Really nice looking chart, but you can't ignore the wicks on trend lines, you use bodies only when drawing horizontal S/R lines. The yellow line is drawn as what, exactly?
And yes, you're extremely early. As BTC becomes more scarce, it becomes more valuable, not less.
Moon_Rocket_Capital
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@theworldinscents, The yellow line is a shortened approximation of the lower bound of a log regression of the trend up to the potential head of the pattern. That trend should maintain a support, and when it breaks it suggests 1 of 2 things:
1) A change in momentum; or
2) An anomaly in data
Through any number of indicators; you can look for confluence to the trend. In this case, RSI is changing and volume is decreasing. Add these to the broken trend, and you get a number of the confirmation factors of a H&S pattern. But this is a situation that requires specific volume patterns for either success or failure - and if bulls can find some short term volume (e.g. off the PayPal news), then there could easily be enough to drive a new impulse and invalidate this pattern.
CreativeCake
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Could be because big players don't buy or sell, they just hodl? More BTC is flowing off exchanges.
Moon_Rocket_Capital
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@hatthawaybriggs, private flow of Bitcoin does nothing to change it's perceived value. If I give you 1 bitcoin and you give me 1 lambo - all it tells us is that I value the lambo > bitcoin. It's only when these transactions happen at mass in a measurable way that we are able to infer value - and thus, trade on it.