DvdGoldberg

Down to 5600 and then up to 7200

BITFINEX:BTCUSD   Bitcoin / U.S. Dollar
As soon as Friday neared to the end, we immediately saw an example of weekend manipulation. From the TA’s point of view, this jump could be seen already 30 minutes before its beginning, about which I wrote in my brief updates "... we have a buy signal on 4H TF ... if the bulls successfully support it, it would reach the daily middle bands of the channels (BB, KC , DC) ~6350-6450 ... "

So, bitcoin developed the run to ~6500, slowing down around 5H SMA100 and 5H EMA91. And if you look at the 5H chart, you would see that the 5H SMA100 still has a downward pressure on bitcoin . I estimated that all these jumps are part of a manipulative short position on the weekend, and all this might fall on Monday-Tuesday. With this approach, it was reasonable to open shorts at ~6250 (10% of the deposit) and at ~6400 (20% deposit). SL (as I already mentioned) - above daily EMA26 (daily EMA26 was not tested since 10 May).

My target has not changed: wait until bitcoin reaches 4H and 5H M/BB and M/KC ( aka SMA20 and EMA20), and then:
A) If this support holds the test and shows an upward signal - then close the shorts, go long.
B) If the support fails the test, then keep the shorts to 4H and 5H lower bands of the channels L/KC ~6100 or L/BB ~5800-5900.

As you can see, bitcoin has already got near to the target, especially at the 4H time frame, touching M/KC ( aka EMA20). Moreover, the proposed model based on daily TF – still applies: bitcoin touched M/BB and M/KC, whereas daily BB did not expand - so might be it was not a breakthrough, but rather a technical movement (test of middle bands of channels).

Let us analyze further possible movements:

1) At the 4H time frame: Bitcoin returned down from the upper bands of BB, KC, DC and rushed to the middle bands, where we are expected a break down. This is confirmed by TIs: %R=-63, CCI=29 (negative trend), DMI=24 ( +DI tends down to -DI ), MACD=58 ( MACD < signal line, FT-negative trend and EMA (6, 9, 12) began a negative reversal.

2) At the daily time frame: Bitcoin is tight near M/BB ( aka SMA20), but the bulls have not been able to fix the position above the M/KC ( aka EMA20) - therefore, it might be followed by a downward turn to the lower bands of channels. TIs produce mixed neutral signals. The positive thing is that EMA (6, 9, 12) started an upward reversal.

3) At the weekly time frame: Bitcoin closed the week above EMA91, which also proves my model based on weekly SMA / EMA 91 and 100. TIs shift to the side of the bulls, but this process could stretch over time, and deeper levels might come (EMA100 ~5650, SMA91 ~5100, SMA100 ~4700). In addition, bitcoin did not fix above L/KC (20; 1), so we might expect testing L/KC (20; 1.5) ~5700. After that I would like to see a rapid acceleration to M/BB (projection) and M/KC (projection) ~7200-7600.

4) At the monthly time frame: As expected, the candle went just below EMA20 - but the closing occurred above this MA. I remind you that since 2015 the monthly candle has never closed below EMA20 and below SMA20. Still there is a high probability that bitcoin will go below monthly SMA20 ~ 5450 (deep to mentioned above weekly MAs), but the closing should be higher than this monthly SMA20.

Conclusion and information about opened position - is at the very beginning, so I will not repeat it.

Good luck.
Comment: Shorts (6250 and 6400) hit SL at daily EMA26 ~6600.
Comment: Quick update, as it's hard to find enough time for detailed analysis.

4H TF: bitcoin slowed-down its run near EMA182. And now (in order to cool-down overheated TIs) bitcoin might go to M/BB (SMA20) or M/KC (EMA20) ~6400-6450.

Daily TF: bictoin slowed at EMA30, closing above EMA26 - that is bullish, as more often a close above EMA26 indicated upward run.

It might be good to start building long position:
1) If pull-back applies, than open split longs at 4H U/KC(20;1), 4H middle bands of channels BB, KC, DC, daily M/BB and the last at daily M/DC.
2) If pull-back does not apply, it is also good to have delayed order above 4H U/DC.

Good luck!

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