For the first time in a while, many front page posts on Bitcoin are bearish. I think a lot of people are setting up for a break to sub $50k prices. Sure, this is possible. But longs have already been flushed out quite impressively several days ago, and large cap alts like Ethereum and Litecoin remain relatively strong. This tells me that capital is not necessarily leaving the market, but simply moving around within it. This is bullish to me, for now. So here, I'm leaning towards a break back towards $60k. First, Bitcoin will need to reclaim some of those shorter term Moving Averages.
On the righthand side, you can see that Bitcoin has triple-bottomed before, and it produced a powerful short squeeze as a result. I remember April, 2018 as if it were yesterday. Everyone was expecting the $6.5k level to break down. Instead, Bitcoin rose dramatically and we had a spring alt season during the early days of the bear market. Of course, price eventually broke $6.5, but it took several more months.
It's important to note that Bitcoin's structure from April 2018 was slightly more bullish - it continued to make slightly higher lows. In this case, price is having a harder time. On the downside, Bitcoin can test the 100 day MA (yellow), currently a little above $49k on Coinbase.
A sustained break below the 100 day MA could send Bitcoin all the way to the 9 month EMA, still untested during this run. That would put price in the mid-$30k zone. My hope is that Bitcoin holds current levels for the remainder of April and perhaps waits a bit longer to test the 9 month EMA, once it climbs to higher levels. Otherwise, the market will be quite shaken...though I suppose punishing latecomers is what crypto likes to do.
This is not financial advice! This is meant for entertainment and speculation only.
-Victor Cobra
On the righthand side, you can see that Bitcoin has triple-bottomed before, and it produced a powerful short squeeze as a result. I remember April, 2018 as if it were yesterday. Everyone was expecting the $6.5k level to break down. Instead, Bitcoin rose dramatically and we had a spring alt season during the early days of the bear market. Of course, price eventually broke $6.5, but it took several more months.
It's important to note that Bitcoin's structure from April 2018 was slightly more bullish - it continued to make slightly higher lows. In this case, price is having a harder time. On the downside, Bitcoin can test the 100 day MA (yellow), currently a little above $49k on Coinbase.
A sustained break below the 100 day MA could send Bitcoin all the way to the 9 month EMA, still untested during this run. That would put price in the mid-$30k zone. My hope is that Bitcoin holds current levels for the remainder of April and perhaps waits a bit longer to test the 9 month EMA, once it climbs to higher levels. Otherwise, the market will be quite shaken...though I suppose punishing latecomers is what crypto likes to do.
This is not financial advice! This is meant for entertainment and speculation only.
-Victor Cobra
Comment:
If the market can shake off the capital gains tax news (Biden is proposing to significantly increase capital gains on the wealthy), that would be a strong sign. However, it's good to be cautious with markets here. Higher taxes on the wealthy can have a dampening effect on the market in the short term, but are good for the real economy long term - especially with the amount of wealth/resource inequality that exists.
Comment:
The fact that Bitcoin did not (yet). make a lower low based off this news seems significant to me. Still a lot of resistance overhead, in terms of shorter-term MA's. But decent buyer volume support.
Comment:
For this to become a "false flag," Bitcoin will need to bounce up towards $58k quite quickly. But first, it will need to reclaim the 100 hour MA (yellow), currently around $55,500
Comment:
The bear flag looks like it's trying to break down here - but until the $50k level is taken out, it can be a bear trap. I'm still seeing plenty of absorption from the buy side as price moves into the $52k area.
Comment:
Only hope for bulls here is if this becomes a false bear flag, as the triple bottom idea has been invalidated.
Comment:
If buyers can take price back to $54k and above, that would be a strong buy signal. Otherwise, the bullish idea may be invalidated soon with a break below $50k.
Comment:
The original idea was invalidated, as the flag did break down nastily towards $47k, but as long as the 100 day MA holds here, that can be the low. Next support is at 44k, and then the 36-38k zone. 36-38k is the lowest I can see things going without venturing into full bear market territory.
Comment:
Interestingly, this second bear flag produced a false breakdown. This is the kind of movement I was watching for originally.
Comment:
One flag too early in calling this one.
