BTC looks set to retest 50 day MA before further up/down side.

BITFINEX:BTCUSD   Bitcoin / U.S. Dollar
Hello and welcome to this simple yet most likely effective analysis of Bitcoin's current condition. As you can see, the 200 day MA provided BTC with all time high daily volume and a nice bounce. At this point it is clear that the 200 day MA's are propping up crypto markets somewhat across the board. There is a clear inverse head and shoulders pattern that has been completed on Bitcoin's rise from the grave. This formation is likely to propel price action up to the 50 day MA. In this case, the more gradual of a rise to the 50 day we experience, the lower (price) the intersection will occur. It looks likely that we will get a somewhat gradual push up to the 50 around $10,500-$12,000 as we are not experiencing a silly elevator like ride up as we did in November.

It is very likely that prices will face some downside after retesting the 50. In the 2014 bubble, prices retested the 50 once after the first massive dip beneath it, consolidated along the average, then took a dive under the 200 day and sunk the 50 beneath the 200 in a death cross. If this happens, we will face a longer term bear market. The deflation of 2014's BTC bubble lead to roughly a 90% correction. This scenario would put BTC in the $2,000-$4000 range. Once we test the 50, we will either breakout, consolidate along the average for a while, or face a strong rejection. I cannot predict with confidence what will happen at the 50 day, however it will be a crucial point that I believe we will witness in February.

Having bought BTC under $7,000 puts you a strong position right now.

Making a small addition to your position on the breakout above inverse H&S pattern for a ride up to the 50 day average is a tolerable risk as you are now up at least 30% on your initial buy.

As I mentioned previously, lower range of target is $10,500. Upper range at $12,500.
If adding an additional position now, setting a stop loss at $8,200 is a good idea to preserve gains from initial position.

Trade safe my friends, keep calm, stick to a strategy, and make sure you've got a decent liquid position on the side in the event of a break below the 200.
Comment: Well this was a valid detection of sentiment to say the least. $12,500 still looks like it will be tough to crack, but this thing has big balls. If the market makers are in a generous mood, we are looking set to run.
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