Morning All,
Bitcoin has been following a channel since the drastic fall from $6480 and is now showing bullish divergence on the 4H RSI and if you look at the daily, RSI(14) is sitting at around 10-11 which is exceptionally oversold in this extended trend. MACD is starting to looking for a cross to the upside, StochRSI is oversold and price has just tested the bottom of the channel which gives credence to a move towards the channel resistance and a temporary bottom. I may be a bit quick to the trigger assuming that price won't drop lower than the $4656 but we have bullish divergence on the 1H and 4H charts and the move to the $4656 low was quickly succeeded with a bounce back to $4754 which took the 4H candle back inside the channel support. Bearish volume spikes are also gradually starting to taper off slightly.
This gives us a decent trade setup if this is the temporary bottom. Buy the breakout above the channel resistance around $5100 (23.6 fib) set stop loss just below the channel support and recent low at around $4645. The market is still weak and over-reactive so I'll be taking profit partially on the way up. I suspect bitcoin will reach the 61.8 fib target around $5780 which coincides with MA50 on the 4H chart. Keep an eye on price at levels around $5800 because if price moves above MA50 and MA50 acts as support, then the next target should be $6090 at 78.6 fib retracement.
If price drops from channel resistance or below the $4654 low and triggers stop loss below channel support at $4645 then I expect the price to drop for another wave down to around $4300.
Good luck and happy trading!
Previous post:
Bitcoin has been following a channel since the drastic fall from $6480 and is now showing bullish divergence on the 4H RSI and if you look at the daily, RSI(14) is sitting at around 10-11 which is exceptionally oversold in this extended trend. MACD is starting to looking for a cross to the upside, StochRSI is oversold and price has just tested the bottom of the channel which gives credence to a move towards the channel resistance and a temporary bottom. I may be a bit quick to the trigger assuming that price won't drop lower than the $4656 but we have bullish divergence on the 1H and 4H charts and the move to the $4656 low was quickly succeeded with a bounce back to $4754 which took the 4H candle back inside the channel support. Bearish volume spikes are also gradually starting to taper off slightly.
This gives us a decent trade setup if this is the temporary bottom. Buy the breakout above the channel resistance around $5100 (23.6 fib) set stop loss just below the channel support and recent low at around $4645. The market is still weak and over-reactive so I'll be taking profit partially on the way up. I suspect bitcoin will reach the 61.8 fib target around $5780 which coincides with MA50 on the 4H chart. Keep an eye on price at levels around $5800 because if price moves above MA50 and MA50 acts as support, then the next target should be $6090 at 78.6 fib retracement.
If price drops from channel resistance or below the $4654 low and triggers stop loss below channel support at $4645 then I expect the price to drop for another wave down to around $4300.
Good luck and happy trading!
Previous post:
Comment:
Bitcoin did find that temporary bottom however it was slightly lower. These are my revised target levels using the adjusted low.
Comment:
Still looking weak on the rebound. Might be worth locking in some profit at these levels just in case we head down to test the new lows from here.
