Potential Fractal

A potential fractal of the April short squeeze appears to be developing, with potential upside of either $7500 if the orange wedge plays out, or $8500 if the pink pennant plays out.This model would likely be invalidated if the price breaks above resistance around $7100 or below support around $6100 before completing the formation.

Comment:

The price broke down below $6100, but not significantly. Overall, this model was a success, as it allowed me to take two long plays around $5800 - once on the bounce and again on the squeeze up.

Considering it broke down further before the squeeze, however, i find the $8500 target unlikely. My targets have been update to a low-range upside of $6800 to re-test former resistance, or around $7500 to re-test the pennant in pink before approaching descending resistance from ATH (orange).

I see that latter as more likely, but the r/r is not in favor of longs until the price breaks out to the upside of $6800.

Comment:

So it looks like this idea played out rather nicely. While $7500-$7600 was my initial target, the comparison to the previous cycle from $6600 to $10k makes $7800 here look very similar to $8600 during the previous cycle, with a failed pump dropping back and then pushing toward a higher high.

While I am overall bearish still, it looks like this has the potential to push toward the $8600 range. I'm not sure I feel comfortable entering any highly leveraged longs here, but it could be something to consider for my fellow degenerates once this consolidation period is complete.

Comment:

Trade successful.