Having recently formed a third touchpoint at the resistance line of a pennant, bitcoin has been on the move down. In terms of the next level of support, 8k has certainly offered support and resistance, but only a little more than one might expect from one of the thousand whole numbers, so to speak. Therefore, I am not expecting 8k to hold as a form of support for a number of reasons:
1) BTC recently formed a fractal on the daily chart, so the fractal traders are in the bears camp at the moment;
2) when prices are in patterns, we often look for compelling technical or fundamental reasons to believe that the price will fail to reach the other end of the pattern, and I cannot see any at the moment, leaving me to conclude we will remain on the path to the other end of the pattern for the time being;
3) the RSI shows plenty of room for downside;
4) so does the MACD;
5) SMA50 (of 8292) seems to be failing to provide support as the price at the time of this writing is 8253.
Ultimately, in my opinion, the most compelling reasons to believe we will continue down are the facts we are on the downward leg of a daily pattern and we just had a fractal form on the daily.
However, I have calculated the 50% fib retracement level to be roughly 8248, and at 8253, that seems to be the only support we are clinging to at the moment.
1) BTC recently formed a fractal on the daily chart, so the fractal traders are in the bears camp at the moment;
2) when prices are in patterns, we often look for compelling technical or fundamental reasons to believe that the price will fail to reach the other end of the pattern, and I cannot see any at the moment, leaving me to conclude we will remain on the path to the other end of the pattern for the time being;
3) the RSI shows plenty of room for downside;
4) so does the MACD;
5) SMA50 (of 8292) seems to be failing to provide support as the price at the time of this writing is 8253.
Ultimately, in my opinion, the most compelling reasons to believe we will continue down are the facts we are on the downward leg of a daily pattern and we just had a fractal form on the daily.
However, I have calculated the 50% fib retracement level to be roughly 8248, and at 8253, that seems to be the only support we are clinging to at the moment.
Comment:
At the moment, I'm still waiting for a clearer picture before I place a trade, but I just wanted to provide my perspective. I'll update this if I trade. Thanks for reading, hope it helped!
Finally, notice that we are possibly forming an EW and as such, moving from a Dow-theory downtrend to a Dow-theory uptrend on the daily chart. Therefore, if the price can rally off this 50% retracement level (or even off the support touchline), that will likely cause a lot of institutional traders to long as point 5 of an EW is one of the most dependable times to long and the R:R from betting on the beginning of an uptrend is very high