(See first part here: www.tradingview.com/v/hPz6Al2m/)
The third triangle is the black symmetrical triangle. It bears some resemblance to the blue triangle in that price spent quite a bit of time looking as if it might make a run at resistance, but instead falling back toward support.
The next element is the Andrews' Pitchfork. Although price broke through the upper parallel line, it has failed to break though the blue price trigger line (which also makes up the upper portion of the blue triangle). Instead, after making an intitial run toward the price trigger line, it fell back down toward the Andrews' Pitchfork.
None of these triangles, lines, support/resistance lines, etc., in and of themselves is particularly meaningful. However, when viewed in combination and in light of weak technicals, they form a picture of price that has shown little momentum to the upside.
A few arguments for why the Bitcoin price will go down below $550 rather than up through $683.26:
1. Bitcoin price has met resistance around the $680 level twice (March and June) and fallen, rather than risen in price;
2. The $550 price level has been tested numerous times and failed numerous times. It was tested twice in June. However, as the $550 price level is tested more often there is a chance the level fails to hold as support;
3. The price trigger of the Andrews' Pitchfork can be looked at as resistance. If you look at it from this point of view - it has only been tested once back in June and has not been tested again. Price doesn't look like it is about to re-test resistance any time soon (next few days out to two weeks);
4. Price is much closer to $550 than $680. Given that the weekly technical indicators such as KDJ, MACD, Stochastics-RSI, etc., have all turned down, it would not take much to push the price below $550;
5. In the case of KDJ, J has fallen very steeply and price has not reflected the steepness of that fall. The last time J fell so steeply was back between March and April of 2013 when the Bitcoin price went from over $250 to almost $60. While I wouldn't expect the same percentage price decline necessarily, I don't think the current price reflects accurately the decline in J (this is not shown on chart, but you can add the indicator on your chart or go to Bitcoinwisdom and plot it easily).
6. Price action rising out of Andrews' Pitchfork proved to be weak - unable to approach price trigger. Would expect the price to fall back toward the upper parallel line of the pitchfork. This seems more likely versus the price suddenly shooting higher and piercing the price trigger.
What to look for next:
1. My expectation would be that price will fall out of the black symmetrical triangle and simultaneously, or shortly thereafter, fall out of the blue triangle.
2. The next thing to watch for is whether price stays within the green symmetrical triangle or falls out of it. Should the price fall out of the green triangle, then Bitcoin price could suffer a much bigger price decline.
Conclusion:
There is no reason that $550 - $560 or so should be considered some sort of Maginot line that the Bitcoin price cannot or won't crack through. Looking at the several triangles, resistance lines, Andrews' Pitchfork, price trigger, etc. on the chart together - along with technical indicators - is supportive of the idea that the Bitcoin price is just as likely, if not more so, to continue falling under $550 rather than breaking resistance around $680 first.
The third triangle is the black symmetrical triangle. It bears some resemblance to the blue triangle in that price spent quite a bit of time looking as if it might make a run at resistance, but instead falling back toward support.
The next element is the Andrews' Pitchfork. Although price broke through the upper parallel line, it has failed to break though the blue price trigger line (which also makes up the upper portion of the blue triangle). Instead, after making an intitial run toward the price trigger line, it fell back down toward the Andrews' Pitchfork.
None of these triangles, lines, support/resistance lines, etc., in and of themselves is particularly meaningful. However, when viewed in combination and in light of weak technicals, they form a picture of price that has shown little momentum to the upside.
A few arguments for why the Bitcoin price will go down below $550 rather than up through $683.26:
1. Bitcoin price has met resistance around the $680 level twice (March and June) and fallen, rather than risen in price;
2. The $550 price level has been tested numerous times and failed numerous times. It was tested twice in June. However, as the $550 price level is tested more often there is a chance the level fails to hold as support;
3. The price trigger of the Andrews' Pitchfork can be looked at as resistance. If you look at it from this point of view - it has only been tested once back in June and has not been tested again. Price doesn't look like it is about to re-test resistance any time soon (next few days out to two weeks);
4. Price is much closer to $550 than $680. Given that the weekly technical indicators such as KDJ, MACD, Stochastics-RSI, etc., have all turned down, it would not take much to push the price below $550;
5. In the case of KDJ, J has fallen very steeply and price has not reflected the steepness of that fall. The last time J fell so steeply was back between March and April of 2013 when the Bitcoin price went from over $250 to almost $60. While I wouldn't expect the same percentage price decline necessarily, I don't think the current price reflects accurately the decline in J (this is not shown on chart, but you can add the indicator on your chart or go to Bitcoinwisdom and plot it easily).
6. Price action rising out of Andrews' Pitchfork proved to be weak - unable to approach price trigger. Would expect the price to fall back toward the upper parallel line of the pitchfork. This seems more likely versus the price suddenly shooting higher and piercing the price trigger.
What to look for next:
1. My expectation would be that price will fall out of the black symmetrical triangle and simultaneously, or shortly thereafter, fall out of the blue triangle.
2. The next thing to watch for is whether price stays within the green symmetrical triangle or falls out of it. Should the price fall out of the green triangle, then Bitcoin price could suffer a much bigger price decline.
Conclusion:
There is no reason that $550 - $560 or so should be considered some sort of Maginot line that the Bitcoin price cannot or won't crack through. Looking at the several triangles, resistance lines, Andrews' Pitchfork, price trigger, etc. on the chart together - along with technical indicators - is supportive of the idea that the Bitcoin price is just as likely, if not more so, to continue falling under $550 rather than breaking resistance around $680 first.
