Most are long and expecting a move to $5k so it's always a good idea to cover the contrarian view and see if we can pick holes in either argument.
We retraced to around $3900 (not too far from the $3930 retracement target in my previous post) but it looks like we'll be retesting this uptrend support soon.
Looking at the weekly chart, it seems that after being rejected from EMA200, bitcoin might just be printing another triangle, similar to the one printed towards the end of 2018.
Then we were sandwiched between EMA50 and EMA100 and now we have the same dilemma between EMA200 and SMA200. We also have major resistance from our ATH which we should be approaching sometime in April if this triangle resistance holds, otherwise sometime later in March if our triangle resistance lies a bit higher.
In 2018, we had a similar triangle setup starting from 30 April 2018. The downside target, based on the height of the triangle, was 42% from breakout and ended up reaching 43.5% when we dropped from $6150 to $3175 before retracing.
Interestingly, the 138.2 - 161.8 fib extension of the drop on 30 April 2018 (which forms the height of the triangle), is also roughly the channel range which we have been following since early December 2018 ($3195 - $4180).
If we have a repeat breakdown from the current triangle, we would have broken below our weekly SMA200 support and a close below it would be a first for bitcoin . I suspect we will retest SMA200 after breaking down and the drop will happen from that ATH resistance.
Target based on the height of the triangle is 29% and the same 138.2 - 161.8 fib extension would provide a new channel range between $2330 and $2630, potentially until we meet that trend resistance again, where we either breakout or breakdown again sometime in August 2019.
We have hidden divergence on stochrsi (which is also venturing into oversold territory), and by comparing profiles, we can see that has been gradually decreasing, similar to 2018 just before the drop . This is just an alternative scenario seeing as we might still be in wave 4, but we'll know as we approach that triangle apex.
Good luck and happy trading!
The wave 4 scenario to $5k first (if this isn't wave 4, we might still be completing wave 3):
Not saying these can't be invalidated but we've had a substantial price drop on 3/3 of the past occasions since December 2017.
Once in December 2017, once in November 2018, once in December 2018 and right about now.
Hmm..wonder what's going to happen soon..
Not to forget the 20 week moving average. No point getting too excited until we see a weekly close above that.
"The wave 4 scenario to $5k first (if this isn't wave 4, we might still be completing wave 3)".
"This is just an alternative scenario seeing as we might still be in wave 4"
"We also have major trend line resistance from our ATH which we should be approaching sometime in April if this triangle resistance holds, otherwise sometime later in March if our triangle resistance lies a bit higher."
Personally I wouldn't be so hasty, we still need to get to $4k let alone $4200. I'm personally only going long once we've broken $4200 first because if we don't I'll be rebuying the lows and if we do I'll be selling for $5k. Even if this is wave 4 and we're heading for $5k. Either way, we still need to then complete wave 5 which lies below our current lows.
Win win imo.
Also, litecoin has nothing to do with my post plus if you can't stomach a $100 price rise on a swing trade, you shouldn't really be trading. Upside potential is great above $4200 and downside potential is great below $4200.
Risk management is also your own prerogative.
Some of these are trending after having already consolidated at temporary bottoms and broken above key moving averages. I would seriously advise again listening to MPC lol, any actual trader would suggest the same.
Litecoin had a major upgrade which explains the price action. Definitely not a leading indicator of the crypto market..
According to reports, litecoin are also losing monthly developer contributions so not exactly a guiding light..
According to the report, there are “many projects are being abandoned by developers are forks of high network value coins.” For example, there are very few developers contributing to the Litecoin (LTC) and Dogecoin’s (DOGE) platforms.
In the past year, the number of Litecoin developers has dropped from around 40 to only three per month, the report revealed.