I think we have a much bigger chance that this rally WILL succeed, compared to the rally of Sunday. We have a much more solid foundation this time. Still does not give a guarantee of a (big) rally, could still make a drop before jumping up. But those chances are very small this time IMO. We have a very strong rally now, that's for sure, reasonable chance we made a (temp) reversal yesterday. But the market is still not over confidently to just buy and FOMO again. Trust has been damaged to much the past month, with the continuing drops we have seen. The ones who got in at the lows will probably take some profit at these levels as well. So there is a big chance we will go sideways again for a day or a few days even. Unless whales are able to create a short squeeze, i don't think we will see a massive continuation of the rally right away. That would only be the case if this is a long term low and buyers are getting in heavily (with volume).
So far we only can assume that this is just an upwards correction of the downtrend. A break of the 6800 would be a first (small step) to prove otherwise. For me the 10K is the level to break to say the downtrend is really over, so it's a very long way to go. If bulls are able to get it above the 8000, than things might rally change again.
For the short term, it's difficult to say what will happen. I think the purple line in combination with the blue line have the biggest chance to succeed. If the 6300 can hold as support we should assume that the 6700/6800 can be reached quite easily (blue line). It would keep bullish momentum the highest for the bulls. 6100 would also be a healthy correction of this rally, but should see buyers coming in between the 6050/6150 (purple line). These 2 scenario's have the biggest chance IMO at the moment. If we do see a drop towards the lows again 5800/6000 (red line), would probably give a good opportunity for buyers to get in that missed out on yesterdays low. This scenario looks kind of weak maybe, but IMO it's more bullish for the mid-term if bulls are able to create a solid foundation for a bigger rally. Even more than the blue/purple scenario's.
Of course there is always a chance that the correction is already over and that we break the 5800 this weak, if that happens, than we could assume the V shape low could be in play because i think that allot of people will get desperate and start to dump again. At the moment i think it's much more likely that we see above the 6500 before even getting close to break the 5800 again. I think these scenario's depend on how big the FOMO factor is. Even though allot of unexperienced keep falling for the same trap over and over and over and over again, think we can assume that at least a % of these people have learned their lesson in 2018, so FOMO factor might be a bit less than it used to be. But of course, if the market just keeps pumping up we all know the FOMO virus will be spread all over again. As long as volatility stays low, FOMO will be less significant.
Don't forget to like if you appreciate what i am doing,
David
Previous analysis:
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Might have a chance that the rally continues from here on out. If the blue area holds, we might see a break of the 6400/6450 today and as long as the 6200ish hold the bullish trend should hold as well
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Looking quite good now, i think we might see a big squeeze again if we push passed the 6400/6450 now, but bulls need to hold the current momentum/pressure
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Things are looking more bullish now. If the bulls are able to keep the price above the 6400 the coming days, we might see a big inverse H&S, like i posted on TV a few days ago. But all depends on what will happen the coming days of course.
I think the RED line at 5750 is the actual path we are headed. Many will argue that we first need to reach a convincing bottom and stay there for a bit for the market to believe the bear market has ended.
This is FUNDAMENTAL thinking and not pure TA.
Then price movements these past 48 hours are too easily explained away with manipulation... plus there has been a lot of symmetry in price movement (signs of bots)
The market buyers saw a great price at 5800 on Friday, it is natural for there to be speculative buying.. but right now, just about every expert is claiming the sweet spot to buy is 5,000.
The lower price bounds make more sense.. between 5700 and 5200. And that is where I feel we SHOULD be headed and deservingly.
UpbeatFX
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@TradeClass, the bottom would create a sharp V-shape, wouldn't it?
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@tingispingis, I have seen many different kinds of bottoms and market reversals. My favorite and most convincing are inverted head and shoulders.
Ideally, that pattern would be the best sign we hit bottom.
However, a deep V is a the sign of a very convincing bounce after touching a hidden BUY ZONE.
I have seen both types of bottoms play out.. including double bottoms
This is FUNDAMENTAL thinking and not pure TA.
Then price movements these past 48 hours are too easily explained away with manipulation... plus there has been a lot of symmetry in price movement (signs of bots)
The market buyers saw a great price at 5800 on Friday, it is natural for there to be speculative buying.. but right now, just about every expert is claiming the sweet spot to buy is 5,000.
The lower price bounds make more sense.. between 5700 and 5200. And that is where I feel we SHOULD be headed and deservingly.