Here's my 2 satoshi's on what could happen with bitcoin. A lot of people have been drawing Inverse H&S patterns, but I can see another pattern that has been overlooked by most, the infamous Cup & Handle! I forecast that the handle will take us down to the 0.236 Fibonacci Retracement line, which coincides with previous support and resistance lines in the past. As we are still above this point, I expect it to act as some kind of support. If we start to capitulate past this point then we assume the pattern is no longer valid. If this pattern is correct, then the target from the breakout point should be the length of the Cup. It's also worth noting that we are still below the overall down trend line from previous ATH's. So if we can break past this at the same time as the handle then it's game on for BTC! If you prefer H&S patterns then the target is still the same. This target also beautifully meets the 0.786 Fibonacci Retracement line. I expect resistance points on the way up like we have currently just witnessed at the 0.383 Fibonacci Retracement line. I am not recommending that traders buy until we have a clear breakout from the top of the handle. This is purely speculation on what COULD happen.
Good luck trading!
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As you can see on the daily time frame, we clearly got rejected from the 50 & 100 Day Moving Average's as well as the 0.382 Fibonacci Retracement line. It is possible that the handle could extend as low as the 200 Day Moving Average and still be valid, so that's is something to look out for as well.
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We may have already formed the bottom of the handle as we are starting to make higher lows. Looks like we are about to make a higher high as well which is a good sign. Too early to confirm yet though and I trades should still only be entered once we break out.
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Looks like we have a pretty decent breakout from the 0.236 Fibonacci Retracement line with volume pouring in! To early to call it yet but we perfectly hit my low target of the projected Handle. This pattern is still only valid once we get a break out from the top of the handle but it's looking pretty good so far. We blasted through the 50 and 100 day MA on the hourly time frames and got rejected at the 200 day. We are looking to get support around the 100 day to make a higher low, and then hopefully we can break through the 200 day.
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Just a quick update on BTC 3.82% . we made it above the 50 day MA and are following the shape of my projected handle nicely. All we can do now is watch and wait for a breakout!
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I've slightly extended the handle, but targets are still the same. This works out nicer because it brings us directly to the top of the downtrend line. No guarantees but we look set to hit that point, and when we do I would be very surprised if we don't breakout soon after! That's when you will really see the volume pouring in confirming the bulls gaining full control.
Of course the breakout won't immediately hit my targets and will take some time, but I do expect this to happen. To those that have said you can't call a cup and handle pattern until it completes, your right and I have said this previously. But understanding how these patterns work and trying to best speculate the outcomes is what traders do. It prepares you for buying and selling opportunities using formulated trading plans.
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We are near the top of the handle, and a breakout is imminent. We could blast though the red dotted downtrend line and head towards the 50% Retracement line, or have a small correction back down to 50 day MA before heading back up and breaking out. This scenario could create an Ascending Triangle, which I will draw later if BTC 3.63% decides to make this move. I find this scenario more probable as we have pretty heavy resistance to break through. The more we test this, the better the breakout! Either way we are looking Bullish guys!
I have to reiterate that trades should NOT be entered until we have a clear breakout.
your original c&h not playing out..but maybe this smaller one( and rising wedge ) has a higher downside target ? between 10000 and 103000..what do u think? thanks
kickflip360
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@mr-cryptopia, Nope, unfortunately not! I measure the base range from the top and bottom lines of the falling wedge, which is around $1100. If you measure this amount from when we broke down from the falling wedge, it takes us to roughly 10370. That's my target.
kickflip360
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@kickflip360, To be clear though, I am waiting for confirmation and breakout of the ascending triangle before entering trades. Less risk = better sleep at night! I am not advising when you should enter :)