All major indicies ended in the red yesterday, except for the Nasdaq 100 (NDX). For this reason, bears should continue to stay put on the sidelines. As long as tech continues exhibiting its strength, notably big tech, the market rally will resume. It is remarkable that yesterday the ADP reported 20.2 million private-sector jobs were lost in April. You'd think the market would sell off on this type of news. We live in a world where markets may now be disconnected from reality quite frankly.
To make things more interesting, like the market, cryptocurrencies sold off into their daily close, shaking the weak hands. Who keeps saying crypto has decoupled from traditional markets?
Yesterday was the dip before 10,000 is tested. Let's go ahead and take a look at Bitcoin.
8-Month Long Brick Wall of Resistance
Bitcoin has been one of the hottest assets since the March low. I admittedly was bearish earlier than I should have. I was wrong! Its part of trading though, so let's take a look at the daily Bitcoin chart below.
Bitcoin is just in pause mode, giving RSI a breather before heading higher toward 10,000. I highlighted that between 10,300-10,900, I would expect sellers to pile in. The 10,000 price handle represents psychological resistance and resistance that has held for 8-months.
Volume will be key for determining the trend. On this rally, the volume has been decreasing (bearish). A spike of volume in conjunction with price action would confirm the direction of the next trend.
On the 4-hour chart above Bitcoin appears to be within a cup and handle pattern. Known as a bullish continuation pattern, its measured target is approximately 10,300 and within the 8-month resistance noted above. The sell-off last night came off some volume, but my view is that volume was absorption. A final shakeout before heading higher. Bitcoin is already back at the highs of yesterday. Congrats if you bought that dip! Bias: Bullish.
Further proof that Bitcoin will making heading higher going into halving is Litecoin. Below is the daily chart of Litecoin.
Yesterday evening Litecoin retested April 28th breakout levels. As of this writing this post, Litecoin continues to show strength off the lows from yesterday. As long as this support holds, dips are for buying.
Not shown here is a lower time frame image of Litecoin which is notable of a falling wedge pattern. If Litecoin makes a bullish break, targets are at its previous high of around 50. Bias: Bullish.
Altcoin Divergence
Before I end this post, it is important to highlight the diversion showing up between Bitcoin and altcoins. Some may suggest that this is a bullish sign for Bitcoin. I do not. The divergence at resistance should not be taken lightly. Although Bitcoin will likely be heading to test 10,000, I would be a strong seller. If altcoins are able to take out their April high I will reassess my bias.
Thanks you for reading this post and I'll talk to you all later on!
To make things more interesting, like the market, cryptocurrencies sold off into their daily close, shaking the weak hands. Who keeps saying crypto has decoupled from traditional markets?
Yesterday was the dip before 10,000 is tested. Let's go ahead and take a look at Bitcoin.
8-Month Long Brick Wall of Resistance
Bitcoin has been one of the hottest assets since the March low. I admittedly was bearish earlier than I should have. I was wrong! Its part of trading though, so let's take a look at the daily Bitcoin chart below.
Bitcoin is just in pause mode, giving RSI a breather before heading higher toward 10,000. I highlighted that between 10,300-10,900, I would expect sellers to pile in. The 10,000 price handle represents psychological resistance and resistance that has held for 8-months.
Volume will be key for determining the trend. On this rally, the volume has been decreasing (bearish). A spike of volume in conjunction with price action would confirm the direction of the next trend.
On the 4-hour chart above Bitcoin appears to be within a cup and handle pattern. Known as a bullish continuation pattern, its measured target is approximately 10,300 and within the 8-month resistance noted above. The sell-off last night came off some volume, but my view is that volume was absorption. A final shakeout before heading higher. Bitcoin is already back at the highs of yesterday. Congrats if you bought that dip! Bias: Bullish.
Further proof that Bitcoin will making heading higher going into halving is Litecoin. Below is the daily chart of Litecoin.
Yesterday evening Litecoin retested April 28th breakout levels. As of this writing this post, Litecoin continues to show strength off the lows from yesterday. As long as this support holds, dips are for buying.
Not shown here is a lower time frame image of Litecoin which is notable of a falling wedge pattern. If Litecoin makes a bullish break, targets are at its previous high of around 50. Bias: Bullish.
Altcoin Divergence
Before I end this post, it is important to highlight the diversion showing up between Bitcoin and altcoins. Some may suggest that this is a bullish sign for Bitcoin. I do not. The divergence at resistance should not be taken lightly. Although Bitcoin will likely be heading to test 10,000, I would be a strong seller. If altcoins are able to take out their April high I will reassess my bias.
Thanks you for reading this post and I'll talk to you all later on!
