cheesetoast
Short

One more leg down for Bitcoin

BITFINEX:BTCUSD   Bitcoin / U.S. Dollar
Further to my previous post titled "Further downside for Bitcoin expected" (link below), the bear flag pattern / ascending channel broken to the downside and reached our profit target. This also coincides with a 127% Fib extension.

So where to now?

Firstly, I will draw your attention to the shaded yellow area on the chart. This is a DEMAND zone in which price rocketed off back in the middle of July (scroll to the left). Price has just touched this zone and we would expect a similar outcome. However, we can see that the bounce off this zone was an absolute shocker. This tells us there is no longer any demand to buy Bitcoin .

It is my opinion that we are to see another push down before a rest and relief rally. The momentum has clearly shifted and we are in BEAR territory having also broken the neckline of the larger inverse head & shoulders pattern. We can see on the chart now that Bitcoin is forming another ascending channel and about to break down. It might consolidate a while longer in this channel but expecting a clean break to our profit target near $5,900 that is also a 1.618% Fib extension.

After this trade, I will be out of all short positions as the R/R is not favorable anymore, until the next clear pattern emerges.

Please give this trade idea a THUMBS UP and I will keep you updated!

Disclaimer: This is only my opinion, make of it what you wish. It is not financial advice.
Comment: False break out of the channel to form a double bottom. Timing incorrect. Tally still weak. Remain bearish and will wait for another confirmation to short.
Comment: The demand zone which previously acted as support has finally been broken. Each rally is weaker and weaker .
Comment: Still on track to our target. Interestingly, there is a substantial Fib cluster at this level that should draw price to it.
Comment:
Comment: Bitcoin has finally reached the $5,900 area as expected. Congrats to those that held a short position.
But don't you see this a daily SFP?
Reply
@bhinderjit, I do, which is why this is the last short trade. I'm still expecting price to reach the target near $5,900.
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