Corn_Reaper

Bitcoin's escapades for the next week

BITFINEX:BTCUSD   Bitcoin / U.S. Dollar
After breaking out from the $4k resistance, I mentioned in my previous post that I had lost confidence in a full wave up to my $4600 target since we had that hidden bearish divergence on the 4H. There was also a slight resemblance to the fractal on 25/26 November when the bull flag failed and headed down to print a higher low at $3684. We've now printed a higher high at $4447 after following a similar pattern to the previous bounce and it seems like we may potentially be forming an ascending channel that could potentially turn into a larger bear flag .

I'm expecting a move down to the 61.8 fib retracement level around $3975 which coincides with the channel support and should establish a higher swing low above $3900. CME bitcoin futures expiry on Friday so i'm expecting a strong move closer to then. If we bounce from the channel support, then we should hopefully form another higher high closer to our $4700 resistance which will bring the price back to the falling wedge support after retracing to around $4236 (61.8 fib retracement from a $6700 high).

If price breaks to the downside from channel support, I'll be looking at $3500 for a new temporary floor.

This is the hidden bearish divergence I was referring to yesterday on the 1D chart. I know the divergence hadn't fully printed yet at the time of posting yesterday but even if RSI and price had gone higher, we would have still had the hidden bearish diversion on the 1D unless price broke $5750 which would have been unlikely or if price had dropped substantially to bring the RSI lower before the close yesterday.


This might mean that the larger bear flag may play out if the daily divergence plays out over the same period of time. I'll be keeping a close eye around channel support.

Good luck and happy trading!

Previous post:


Nov 28
Comment: Edit:

***If we bounce from the channel support, then we should hopefully form another higher high closer to our $4700 resistance which will bring the price back to the channel support after retracing to around $4236 (61.8 fib retracement from a $4700 high).
Nov 28
Comment: **Edit: (sorry early morning)

Nov 29
Comment: Hidden bullish divergence on the 1H. Price is heading back up to retest channel resistance:

Nov 29
Comment: It broke out just after I posted that. Keep an eye on volume and the channel resistance once we reach it:

Nov 29
Comment: Channel resistance has just been tested and there is now bearish divergence on the 1H chart. It also looks like price fell out of and retested a rising wedge. Now looking for a move back towards the $4k.

Nov 29
Comment: We have hidden bullish divergence currently playing out on the 30 min chart. Watch volume and the channel resistance as we approach it. We may have a breakdown from there (around $4500) which would validate the bearish divergence on the 1H.

Nov 29
Comment: Bitcoin broke above significant trendline resistance so we may be potentially be building for a continuation higher and the retracement from here may not drop as far down as $4k (we still have bearish divergence on the 1H). I think we will have a final wave towards the wedge resistance then we'll probably retrace back to $4150-$4180 for a continuation of the uptrend.

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