Good morning, traders. After a bit of a boring night, Bitcoin has decided to move this morning. At this point, price has stopped just shy of yesterday's high. As I discussed during last night's stream, there was a possibility for price to have one more leg up toward the $6900-$7000 area. This may be playing out at the moment as we have seen price breach $6800.
The 1 hour chart shows us that RSI bounced off its support over night, however that also means it's been hanging around overbought for almost 24 hours. Price needs to retrace a bit so that RSI can reset for a further push upward. To do so now should mean that we will see price retracing toward the $6350-$6500 area. This would keep it inline with what I suggested last night. Depending on which channel price follows, we could likely see a dip down to ~$6500 and subsequent rebound toward ~$7150-$7200 for the green or a dip down to ~$6350 and a rebound toward ~$6950-$7000 for the yellow. These rebounds are minimum expected movement depending on how long it takes (and the expectation is that price follows the general ABCDE layout provided as it reaches those points). MACD is about to print a bullish crossover and has been printing higher lows and higher highs since June 10th. This has me thinking that the green channel is the more likely of the two right now. As always, the expectation is for price to target the top of the channel. But keep in mind that shorts are loading up still, and if the same progression from April is in play, then we can expect a good short squeeze within a couple of days. It shouldn't be the size of April's short squeeze, based on the current shorts chart and shorts v. longs chart, but it should be enough to send price through the resistance of the descending channel, descending broadening wedge, and support of the red triangle.
A quick look at the daily shows us that current price action continues to mimic April's on this larger time frame as well. RSI is currently sitting at 41.6, working its way toward the next resistance level at 47. %B is testing its own resistance area at this time as well. We can also note that MACD is about to print a bullish crossover. When it comes to the bigger picture, we should also make sure that we see the higher highs and higher lows that MACD has produced since February. Remember, MACD is a momentum oscillator which provides forward-looking guidance. The fact that it has produced a bullish trend since the February low in price should be telling traders that it is increasingly likely that we will ultimately go up rather than down. Of course nothing is guaranteed in trading, but that's how it should be read at this time, especially since this is occurring over a 4 month period on this larger time frame, giving it much more significance than anything happening on the smaller time frames.
The 4 hour chart gives us a good mid-term view of the action. Price has entered the cloud, but has found resistance twice now at the 1.272 fib extension pulled from the $7040 low to and the $7779 high. The channels provide expected support and resistance with the ascending red triangle support line providing resistance as well. A breach of the top of the descending channel should signal a bullish trend. This may only be in the short term, but it gives us targets of $7500, $8150, $8500/descending resistance line of the red triangle. Failure for the green channel to support price should have traders watching the yellow channel on the 1 hour chart. If price breaches support of both channels, the expectation at this time is that we will likely see price dropping below the February low.
The 1 hour chart shows us that RSI bounced off its support over night, however that also means it's been hanging around overbought for almost 24 hours. Price needs to retrace a bit so that RSI can reset for a further push upward. To do so now should mean that we will see price retracing toward the $6350-$6500 area. This would keep it inline with what I suggested last night. Depending on which channel price follows, we could likely see a dip down to ~$6500 and subsequent rebound toward ~$7150-$7200 for the green or a dip down to ~$6350 and a rebound toward ~$6950-$7000 for the yellow. These rebounds are minimum expected movement depending on how long it takes (and the expectation is that price follows the general ABCDE layout provided as it reaches those points). MACD is about to print a bullish crossover and has been printing higher lows and higher highs since June 10th. This has me thinking that the green channel is the more likely of the two right now. As always, the expectation is for price to target the top of the channel. But keep in mind that shorts are loading up still, and if the same progression from April is in play, then we can expect a good short squeeze within a couple of days. It shouldn't be the size of April's short squeeze, based on the current shorts chart and shorts v. longs chart, but it should be enough to send price through the resistance of the descending channel, descending broadening wedge, and support of the red triangle.
A quick look at the daily shows us that current price action continues to mimic April's on this larger time frame as well. RSI is currently sitting at 41.6, working its way toward the next resistance level at 47. %B is testing its own resistance area at this time as well. We can also note that MACD is about to print a bullish crossover. When it comes to the bigger picture, we should also make sure that we see the higher highs and higher lows that MACD has produced since February. Remember, MACD is a momentum oscillator which provides forward-looking guidance. The fact that it has produced a bullish trend since the February low in price should be telling traders that it is increasingly likely that we will ultimately go up rather than down. Of course nothing is guaranteed in trading, but that's how it should be read at this time, especially since this is occurring over a 4 month period on this larger time frame, giving it much more significance than anything happening on the smaller time frames.
The 4 hour chart gives us a good mid-term view of the action. Price has entered the cloud, but has found resistance twice now at the 1.272 fib extension pulled from the $7040 low to and the $7779 high. The channels provide expected support and resistance with the ascending red triangle support line providing resistance as well. A breach of the top of the descending channel should signal a bullish trend. This may only be in the short term, but it gives us targets of $7500, $8150, $8500/descending resistance line of the red triangle. Failure for the green channel to support price should have traders watching the yellow channel on the 1 hour chart. If price breaches support of both channels, the expectation at this time is that we will likely see price dropping below the February low.
