WARNING: Severe hidden divergence in BITCOIN!

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
Above we see a very classic example of hidden divergence.
Hidden bearish divergence occurs when price tops get lower, while RSI tops get higher.
It basically means immense strength was needed to get price half-way to where it once was.
Considering this is showing in the DAILY with EXTREME divergence in price, things are about to get interesting.
The ONLY WAY this divergence can be invalidated is a daily close above the highest daily close so far at $4,073.
This would mean, for the very first time in over a year, Bitcoin would have to create a higher high.

One way or another, this WILL lead us to our short-term answer. Up until now, my stance has been incredibly bullish .
Bitcoin had a strong chance for the first time since early January to create a higher high but it petered out at $3,700.

Price targets are marked on the chart. Good news is, we'll likely have our answer in a matter of a day or two.
This divergence is EXTREME, so price action will get very sharp. The weekly close happens today, so be very vigilant of the new daily.
My short-term bias was bullish , but if we are to follow what the indicators say, it is now time to be a bear again.

Comment: If this hidden divergence somehow does get invalidated, a daily close above $4,073 will be a MASSIVE buy signal. Arguably the strongest one we have had since the ATH downtrend began. Stay vigilant people.

To me, this looks like an epic bull trap, but one cannot ignore how blatantly painted it is on the charts. This may be a legitimate rally but we will likely know for sure by the daily close. I would say if we don't drop like a brick by tomorrow's daily close this is likely a real rally.
Weekly is so far showing a nice bullish engulfing candle, but the technicals are ugly af.
Will Bitcoin create the first higher high since ATH?
Comment: Last time we had divergence like this on the daily?

We plummeted 50%.

The divergence being seen now is far worse. Yikes.
Comment: Technically speaking, since Bitcoin did not close ABOVE prior RSI high, TECHNICALLY it has a strong chance to be invalidated.
This would likely be our "C" wave, if we go bullish.

If this activates downtrend, lord have mercy on our souls
Comment: $4,100 would be my sell-all target. IF we rally towards $4k and we are rejected somewhere before or around $4,100, I'd be shorting the ever loving SH*T out of this.
S/L for those long right now IMO would be below $3,450
This was posted January 10th. B wave has respected the .786 so at this point I do believe we are likely beginning the "C" wave correction. AFTER "C" wave, we will likely find new lows. Price target on this idea for "C" wave was not measured, so it is highly unlikely to be hit unless we are ACTUALLY bullish.

This is the idea I really want people to see, and is the reason why $4,100 is so important. $4,100 is the .786 bear retracement of this entire move upward. As in, the last stand for the bears. Just BREAKING this implies a very bullish structure, but for one to truly believe the bear market may be over we would need to see a break of $4,240.
If $4,240 breaks our next target is $5.5k.

$2,435 is the target for the next downtrend if we cannot surpass $4,240.
Comment: Putting this here for later.
Comment: Ethereum, **LTC**, TRX, **XLM**, IOTA, BNB, NEO.
Find entries into these alts.
If this analysis is validated, and we fall as hard as I think we may, alts/btc ratios will SKYROCKET.

LTC and XLM will be massive gainers if this downtrend activates.
While Bitcoin is plummeting will be the time to look for entries, not during, not before.
Comment: While Bitcoin is plummeting will be the time to look for entries, not before, not after**
Comment: This is going to be incredibly fun to watch.
Heed my warning, indicators are powerful and they are telling you something.
So are fibs.

Full panic is about to grip the Bitcoin market. Wait and see.
Comment: For those of us bears out there- now is a great time to get really nervous.
After doing a lot more analysis, I came up with this for the bullish side of things:

For being an out-of-position bear, this makes me incredibly nervous.
Since the massive fall we experienced that brought us down to $3.1k, I've had this funny feeling, really funny feeling that the whales would have one last trick up their sleeve prior to Bitcoin experiencing its next bullrun.

I've been extremely bull lately, because I've been seeing things that are out of the ordinary for Bitcoin. Especially considering the severe divergence on the daily, yet we've had 2 days to drop and we haven't yet.

Aside from that, the one thing that has stood out to me like a sore thumb is the premium on Finex. WHY is there still a premium? I've gone back and forth in my own head about it so much I'm starting to go crazy.


While people were panic exiting tether, whales were scooping it up on the low while selling their Bitcoin for top prices. A LOT of Tether was used in that pump. A LOT. So, my best guess is that they are accumulating with said cheap Tether they accumulated.
Why? Usually it's to dump on us, right?

Then we see longs having SKYROCKETED, by almost 10k BTC as we were close to finishing the drop. Yet we're still printing a FAT bullflag in longs, even though the price has continued to slowly fall.

To top all this off, the bull count right now for Bitcoin shows we would be breaking out of the bearish pennant, with a re-test of the pennant for a 4th wave. Past that, the sky is the limit.
Considering how well these fibs line up, I am very nervous.

Imagine how many people are waiting right now for cheaper prices.
Imagine how many people sold their Bitcoin already, waiting on the 200 MA alone.
Imagine how many people are going to end up FOMO'ing if we create a higher high for the first time in over a year, meaning they'll have to pay A LOT more money for the Bitcoin they sold in the first place.

Something isn't lining up. This market loves to do the unexpected.
Right now, with how many bears including myself are out of position, THIS IS THE TIME OF ALL TIMES to end the bear market.
After seeing these fibs, and seeing this long bull flag very near the apex, I am very concerned.

This has a very high possibility of being the END OF THE BEAR MARKET, staring us right in the face. I'm not sold on the end of the bear market until we see a breakout above $6k, but I will definitely be accumulating as soon as I can get some more capital in the event this is the end.
Comment: Bull side of things:
Nothing more than a published idea of what was said above. Still wanted to make it an idea for later use.
Comment: Here you go bulls :D
Comment: dis no goot
Comment removed.
The hidden bearish divergence is technically/re. the tops correct. While the price is making lower highs, RSI is surging, so good spot on that! Question/where I'm not sure is: How reliable is it, when you leave 2 lower highs out of the equation?
@Jack777, OUT of the equation? That's an interesting question. I would say that if there was higher highs it would obviously be a strong sign of potential markup.
Edgy_ mc_peewee
@mc_peewee, Not sure if you understood: Between 'PriceTop1' & 'PriceTop2' there are 3 significant lower highs, which you are ignoring in this case. If you e.g. take the last LH before the break-out, obviously there is no divergence at at all: Both price & RSI is surging.

So what you're doing is: You are leaving the last 3 LH out, only then you get the hidden divergence.

=> I'm not sure if this is as significant as e.g. if the hidden divergence would happen immediately at the second LH. It is little bit like a noob-drawing trendline: Ignoring signifcant HL or LH in the chart between point A & B, putting the trendline somewhere in blue sky. But I'm not sure in this case, that's why I'm asking if you have better info.

your charts are no bueno
+3 Reply
mc_peewee TheCryptAlpha
@TheCryptAlpha, Okay! Thanks for the comment :)
mc_peewee scripter
@scripter, This indicator will be showcased in my new idea today :) Now that I know what it is, it will only help my case. Thanks for sharing :0
Sorry but: "Hidden bearish divergence occurs when price tops get lower, while RSI tops get higher." thats a bullish divergence by textbook definition!
Its a bearish divergence when price tops get higher, while RSI tops get lower.
Or am I missing something here?
+4 Reply
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