As discussed in recent analysis here on TradingView Bitcoin does, until proven otherwise, trade within a big zigzag correction. (For more information on this, please see our previous posts.)
The downwards break of the B-wave came as no surprise as we thoroughly discussed its inherent weakness throughout. What we see now is likely the initiation of the C-wave in which we are now in the second correctional wave of the first wave.
What's more to it is the fact that Bitcoin's prospect second wave of the first wave of the C-wave is now trading right at horizontal resistance (zone 2, please see picture). Even if the price were to temporarily ignore this zone (which by no means is unusual amidst correctional moves) I still don't expect Bitcoin to push above $49 100 which coincides both with the 618 fib and a horizontal resistance line of its own.
On a final note, support zone 1 is one of key importance. This is the key divider between the bulls and the bears. As we can see, any touch on this historically has resulted in violent price moves. The only main exception is the rejection in early August upon which the bulls immediately stepped in and showed their presence. If we were to see a similar move soon upon re-testing this zone (zone 1), then fasten your seatbelts, for then Bitcoin will go down hard.
If, on the other hand, Bitcoin were to bounce aggressively upon such re-test it could very well prove to be the reversal prior to new all-time highs.
Personally, I don't expect it to hold. Yet, I will still take a high RR long position.
My plan here is to release the position immediately if Bitcoin were to plunge through this support right away. But as I expect this zone to be too strong to break through without a fight I will take a speculative long here. What I will do is to set my first target between $44 000-45 000 and, at which I'll release 10-15% of my total holding. At the same time I'll increase my stoploss to breakeven. In this instance, I'm guaranteed profits regardless of what. If this in fact were to be the key reversal then we'll have bought at the absolute low. If Bitcoin were to break below without a fight, it means the bulls are exhausted. In such case I'll look to ladder in leveraged shorts as I'd then expect the price to drop significantly - technically as low as $22 000 (again, for more on this, please read the previous analysis here on TradingView).
The downwards break of the B-wave came as no surprise as we thoroughly discussed its inherent weakness throughout. What we see now is likely the initiation of the C-wave in which we are now in the second correctional wave of the first wave.
What's more to it is the fact that Bitcoin's prospect second wave of the first wave of the C-wave is now trading right at horizontal resistance (zone 2, please see picture). Even if the price were to temporarily ignore this zone (which by no means is unusual amidst correctional moves) I still don't expect Bitcoin to push above $49 100 which coincides both with the 618 fib and a horizontal resistance line of its own.
On a final note, support zone 1 is one of key importance. This is the key divider between the bulls and the bears. As we can see, any touch on this historically has resulted in violent price moves. The only main exception is the rejection in early August upon which the bulls immediately stepped in and showed their presence. If we were to see a similar move soon upon re-testing this zone (zone 1), then fasten your seatbelts, for then Bitcoin will go down hard.
If, on the other hand, Bitcoin were to bounce aggressively upon such re-test it could very well prove to be the reversal prior to new all-time highs.
Personally, I don't expect it to hold. Yet, I will still take a high RR long position.
My plan here is to release the position immediately if Bitcoin were to plunge through this support right away. But as I expect this zone to be too strong to break through without a fight I will take a speculative long here. What I will do is to set my first target between $44 000-45 000 and, at which I'll release 10-15% of my total holding. At the same time I'll increase my stoploss to breakeven. In this instance, I'm guaranteed profits regardless of what. If this in fact were to be the key reversal then we'll have bought at the absolute low. If Bitcoin were to break below without a fight, it means the bulls are exhausted. In such case I'll look to ladder in leveraged shorts as I'd then expect the price to drop significantly - technically as low as $22 000 (again, for more on this, please read the previous analysis here on TradingView).