MagicPoopCannon

Bitcoin Pulled Back As Expected — Here's What I'm Watching...

COINBASE:BTCUSD   Bitcoin / U.S. Dollar
Hi friends! Welcome to this update analysis on Bitcoin! Looking at the daily BTC chart, you can see that BTC has pulled back just as expected. In the last analysis, titled "A BTC Signal With 100% Accuracy For Your Viewing Pleasure," I showed how the extreme separation between the Gaussian Channel, combined with the parabolic rise in price, and the extremely high NVT reading, suggested that there was a high probability of a pullback. Now that BTC has pulled back, we can see that it has formed an uptrend channel (in blue) on the chart. The pullback has taken BTC down to the middle of the channel, which could act as support. However, BTC is currently struggling to recover above the 17115 level (yellow trendline.) While I do think there is a high probability that BTC will remain in an uptrend, we could see it fall deeper into this channel first. At this point, it's important to watch the 50 day moving average (in orange.) If BTC comes in contact with the 50 day, it is very likely to act as support, especially considering all of the hype and excitement around Bitcoin right now.

So far, we've seen a test of the all time high (within 1%) and now we have a pullback. Technically, that's a double top , and double tops can be very bearish if they aren't quickly surpassed. So, with that in mind, the most important thing to watch on this chart (as a heart monitor for BTC ) is the performance in the uptrend channel . If at any point we see BTC break down below the uptrend channel , that would be an extremely bearish sign, indicating that the double top was a more serious failure than anticipated. With that said, I do expect that BTC will find support somewhere inside of the uptrend channel , and that it will likely test the all-time high again in the near future. However, that is just my opinion of what I think is most likely. We need to see support, and a higher low in the uptrend as confirmation.

I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.

***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***

-JD-

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