Hi friends! Welcome to this update analysis on Bitcoin! Before we get into the chart, I want you all to know that this analysis involves a projection of a pattern that doesn't fully exist. So, have an open mind. This is meant to be a fun and exploratory analysis, as we assess a possibilities for how this price action could develop. You may have heard me say recently, that an inverted head and shoulders pattern could be developing. Today, we're going to take a look at how that could happen, and where we may be in it's progression. So, without further ado, let's get right to it!
Looking at the daily chart, we can see that BTC closed yesterday's candle above the downtrend channel (in pink.) Today, we appear to be testing the top of the downtrend channel for support. You can see that we were below it, at one point today, but we are now right on top of the pink downtrend channel. If BTC can close above the top of that downtrend channel, and confirm it as new support, that would be a short term buy signal, indicating that a test of the 50 EMA (in orange) is imminent.
Now, here is where we can play with some exploratory price projections. Assuming that price holds the top of the downtrend channel, and then rallies to the 50 EMA (green arrow,) we can predict that the 50 EMA could act as initial resistance. That would actually be very likely, since the 50 EMA has been so resistive in the recent past. You can see it on the top left of the chart, but even more when you zoom out. So, the 50 EMA is likely to act as initial resistance. Therefore, we can assume that price would then fall back toward the top of the downtrend channel (red arrow.) From there, support could be found, again, on the top of the downtrend channel, causing price to rally back toward the 50 EMA and the neckline (green arrow.) Such a move would complete the right inverted shoulder.
Since the 50 EMA is converging with the area where a neckline could be produced, a breakout would likley take both of them out simultaneously. Such a move would be a powerful short-term bullsih indicator, and price could experience a significant rally higher.
If you recall from my past analysis, I said "If we see price rally above the 50 and hold it as support, I think there would be an extremely high chance that we will rally back into the "Major Overhead Resistance Zone," to actually test the 5775-6000 area, and potentially confirm it as resistance." Interestingly, if we DO create an inverted head and shoulders here, we can already see what the height of the head is likely to be (left black vertical dashed trendline.) Interestingly, the height of that proposed pattern, added to the neckline, projects a rally potential almost exactly into the Major Overhead Resistance Zone. So, the size of this potential inverted head and shoulders pattern is a perfect size to produce a rally to the exact level.
With that said, I realize that such forward projections are risky and potentially misleading. However, this is is an educated and informed look, at what we may be setting up for. For the record, it's best to always trade patterns when they are clearly developed. This is not yet a clearly developed inverted head and shoulders pattern, so I wouldn't put much credibility into it, until the pattern develops further.
Regardless, we may be setting up for a test of the 5775-6000 level. Does that mean the bear market is finished? Not at all. It could be, but I highly doubt it. But we don't have even a sliver of PROOF yet. Proof would consist of the market rallying above the 6000 level, holding it, and then starting to print higher highs and higher lows on the chart. Until then, there is no sense in trying to declare the bottom. We rode the wave down from 6000 perfectly, and (so far) we've ridden the wave up from the exact bottom of this recent low. So, who care's if it's a potential bottom? It's still tradeable, bottom or not. My bias is that this is a bear market rally. We haven't even seen a single higher high, and people are already declaring that the bottom is in. That, is pure ignorance. Hands down. The market is literally still in a technical downtrend, with lower highs and lower lows. The market will SHOW us when the bottom is in. Remember, never try to catch a falling knife. This market could easily rally to 6000, fail to get above it, and fall well below 3000.
So, for now, our focus is on the top of this downtrend channel, and whether or not price can hold it as support. If we break back down into the channel, and begin to head lower, then the whole inverted head and shoulders idea goes out the window, as price would then be likely to trade to a lower low.
Happy Holidays Everyone!
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.***
Magic, normally i do not make accounts like this. The only account i have is the account of my company. But i only Made this account because all the motherfucking haters. You say you are the legend the master of the charts and all those things. And i really love iT when you say this. Because you are really the boss. The legend. You are like bowser in Mario, but the different between you and browser is that you kill them all. You are the end boss. I love you and please never stop with this. Much love. Greets an other end boss.
stefanielizabeth
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@alinicolaas, a few months ago I made an account on trading view for the exact same purpose :p
nesgoombas545345
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***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
Adding to that, this dude has been wrong on so many occasions.. His success rate is more like 25%.
deactivatedaccount123
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@nesgoombas545345, Since he came back, please point out to me anywhere he was wrong. Please. ;)
nesgoombas545345
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@MC_Peewee, On several charts back, he is 99% confident that we will see 1000 BTC. lol
He is the master of all angles. He called 1000, 3000, 5775, 6000 at the same time.. His predictions are no better than mines or yours.
zutta
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@nesgoombas545345, why are you here then ? you seem to still want to follow him .lol easy to sit back and point the finger yet you don't seem contribute any ideas yourself.
goodjob_goodeffort
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@nesgoombas545345, He still thinks we are going lower tho...what has changed? Are you saying it is now impossible to go to 1K? Its not about being right every time anyways. That is impossible. It is about a sound thought process and analysis. His are much better than mine or yours. You are just too dumb to see it. Noob.
BradFranklin000
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@nesgoombas545345, You do understand that TA is about REACTING to what is in the charts? And, you do understand that changes every 1, 2, or 4 hours, right? And, the market is non-deterministic, chaotic interaction between a huge number of players influenced by a massive number of factors including each other.
Here's what to do to keep from getting your panties in a knot: realize each post and comment from Magic is his appraisal of where the CURRENT CHART is pointing for its MOST LIKELY next move.
Once you can grasp that, you no longer sound like a noob and maybe you can even offer your own constructive point of view. Try it - it's fun!!!
sergio00
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"So, who care's if it's a potential bottom? It's still tradeable, bottom or not". I am 120% agree. The most importan is not the price, is the % you win in each movement. 3K-6K have the same profit than 10K-20K
sergio00
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@sergio00, Only a Holder that dont trade anything ( RIP,, they lost 95% from january ) need to know the bottom.