Looking at the daily BTC chart, you can see that not much has changed since yesterday's analysis. However, there are subtle details that are noteworthy. As you can see, I have the candles of the past three days circled. That's because the current candle formation looks like it's setting up to print a small .
For those who don't know, a is a reversal formation, that typically presents itself at the bottom of a move. For the pattern to be created, there needs to be a red candle with a relatively tall body, followed by a star, followed by a green candle, with a relatively tall body. On the chart, we have a small version of that developing. You can see that on the 14th, there was a red candle. The body of that candle isn't as tall as we would like, but it still fits the criteria. Next, we have a clear , and it is in the proper position — slightly below the previous day's candle. Today, we are currently forming a green candle, which currently has a perfectly tall body.
Since today's daily candle hasn't closed yet, there is still a lot that can happen. We could see the candle turn red and form an , if the market pushes to the downside. Obviously, if something like that happens, that would negate the potential of a formation. So, before we jump to conclusions, we really need to see how this current daily candle closes. Assuming that a is printed, we need to see an immediate continuation higher, to validate the pattern.
However, keep in mind that the 10 (in blue) is just above. It has been extremely resistive during this selloff. So, if we close a few candles above it, on the back of a reversal signal, we can assume that there is a good chance for a relief rally to ensue.
Additionally, the has been printing an increasingly long . Unfortunately, there is no real momentum expansion yet to speak of. So, I wouldn't get too excited about it just yet.
Overall, I'm simply illustrating that the finer details of the BTC chart are flashing some mild (currently unconfirmed) reversal signals. We haven't touched the $3000 level yet, and there's no guarantee that we will. Ultimately, if the current candle doesn't complete the , the likelihood is that we will continue to drift lower, until we test support on $3000. Regardless, the decline in sell-side momentum, the potential , several spinning tops, a building divergence, and quiet , shows that market is indecisive and we may be approaching a brief turning point in this selloff. With that said, don't jump to conclusions until these things are confirmed. The technical development that I'm looking for, as an indicator that a rally is beginning, is a close above the 10 on rising and expanding momentum.
Happy Holidays Everyone!
'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***