Some major resistance levels were taken out like nothing, resistances that have been holding Bitcoin back for months and weeks. Now Bitcoin is sitting on a completely new set up, and we have and signals coming from all the charts, so what will happen next?
Will Bitcoin continue growing, or will it enter the classic retrace?
Let's start by looking at Bitcoin on the 4H time frame:
- Here we can see strong divergence on both the and .
- BTCUSD has been able to stay above EMA10, which signals potential, but we have decreasing and the (green) line starting to curve down.
- The last peak is barely higher than the peak from the 3rd April.
- After a strong wave normally comes a retrace (this is not a real signal but we should also take it into consideration).
When looking at BitMEX, the second peak is lower than the first one so they are moving ahead in some ways, so we are looking at a short term which signals to a drop:
On and CoinBase, we have the same pattern as in BitFinex, a higher high on low and strong divergence, telling us that Bitcoin is more likely to go lower before continuing up on this time frame.
Bitcoin on the daily time frame:
Only the 4H time frame in this analysis is clearly to me, the daily time frame is showing mixed signals, let's get to it:
- The chart pattern we are seeing can produce another impulse move to the upside. Also the fact that even though BTCUSD is showing weakness with the mixed signals, it is still trading above EMA300. A close below EMA300 (gray line), will certainly send BTCUSD to test EMA200, above it, the potential remains.
- I believe that EMA100 (blue line) also needs to be tested since it took a long while for this level to be broken. So it needs to be tested as support eventually, it just doesn't need to happen now.
- I can see some sideways consolidation happening around this level (current price) above EMA300, another possible scenario. But if Bitcoin is really and wants to continue going up, it will most likely follow with the impulse or breakdown to remove weak hands and give a try at $6,000+. Right now this is the less likely scenario in my opinion and Bitcoin is more likely to retrace from here. Why? Let's look at the weekly chart now.
Bitcoin on the weekly time frame:
- The resistance Bitcoin is challenging here is really strong, we are looking at EMA50 and EMA100. Good strength and is needed to break above these levels.
- The signals here are mostly . The And are.
- Just looking at the chart structure, Bitcoin can break up immediately, but EMA200 (orange) was a very strong resistance that has just been conquered and the bulls took their time. I don't see them having any hurries... Bitcoin can consolidate, retest support before continuing up, that's the green line.
- The blue arrow is the scenario where we go straight up, but we would still need a retrace after that and long consolidation before any sustained and maintained growth.
My view: We expect a drop followed by additional growth. This can all take weeks to develop, no need for rush. The altcoins can grow slowly while Bitcoin consolidates its new growth.
Conditions for change: If Bitcoin breaks down and closes below EMA200 ($4155) with good strength and , this would change our view from to mid-term. A close below followed by a bounce can happen, fake breakdown, this wouldn't change our view at all.
A close below MA200 ($3500) would change our view from to long term.
Everything above MA200 (black line) is for us in the sense that Bitcoin projects long term growth for the future. This is all based on the weekly time frame/view/perspective.
What's your take on Bitcoin?
Where will it go next?
Are we going to drop now or continue up?
Please share your thoughts in the comments section below... Keep on reading!
Altcoins Market Update
I believe that the altcoins medium-sized and small market cap. altcoins (major altcoins are moving with Bitcoin ) will continue to grow.
Those that already had huge gains will retrace and consolidate, those that are bottomed out will jump up and grow in value.
I will be reading charts and sharing what I see.
Feel free to hit like now if you found this trade idea useful or entertaining in any way.
Thanks a lot for the continued support.
This is Alan Masters, and soon I'll be back sharing some more.
Before I leave here is a quick phrase to maybe inspire you and motivate your day, in a very simple and beautiful way...
IT ALL CONTINUES AND IT KEEPS ON GOING
Life keeps on going, it all continues.
It doesn’t matter if you believe it or not.
It doesn’t matter if you think is right or wrong.
It no longer matters if the answer you gave was correct.
It doesn’t matter if it was wrong, it never mattered for anyone anyway.
Life goes on, meditation or not.
Life maintains its pace, doesn’t matter if you meditate.
So it doesn’t matter how far you really go…
If you are trying to make sense of everything, enjoyment is the answer when you finally reach the goal.
Life is not meant to be understood.
Life is meant to be enjoyed.
LTCM19 +60% ROE