What does stick out a bit, the on is a bit higher than one would expect during a . Others it's less clear. On the right we can see the , as i mentioned in an earlier update, bulls need to get above 6600 at least to fight off this . if they can do that, only then the bulls have a chance to maybe prevent a big drop below the 6K towards the low 5K. Still no guarantee it won't happen if they get above the 6600, but IMO the chances get closer to 50/50. At the moment the bears are still in full control.
As i mentioned yesterday we can expect this sideways movement for several days, and i think that if we stay below the 6600 that this small will probably turn into a bigger. Both scenarios could indicate a big panic V shape which i talked about months ago but did not think it would happen anymore.
On the left we can see 2 different scenario's. The blue one, which is less likely to happen as long as we stay below the 6600 (which was a huge resistance for weeks the past month. So the bulls need to show some real power the coming week or so to be able to pull that one off. The red line is semi because it still shows a big drop eventually. I drew a big triangle here, but i am still not sure which of the 2 resistance lines will be the right one, the one from the 10K high or the blue one. If it's the black one, than bulls are in big trouble because that means the bulls did not even have enough power to test the resistance and fell short. This would mean the chances are very high for a break of support and another big drop . That would explain this huge dump we had yesterday.
If the blue one is the right one to use, than it still more than but a bit more in balance. I still think the 6200ish level i mentioned yesterday, is the level to hold for the bulls, maybe a bit more room toward 6100. I think if those levels break the chances increase allot for another big drop . So for the bulls to turn things around again, they need to show some strength the coming week and put the bears under pressure, as they did in July when they rallied from 6300 towards the 6800 and broke it because the kept the pressure on the bears. I am quite sure it's the same Bitmex bears that lost the big fight back then, because you could see big amounts of short selling but because the bulls showed conviction their was bigger than the bears. That's why they won and forced that big squeeze. This is what the bulls need to show again if they want to safe themselves from a huge drop , conviction and volume!
So unless the 6600 breaks, the bears will keep 100% control
Actually nothing has changed yet, so everything from the above is still the same now. There has been a new resistance level created now on the lower time frame. Bears still have the upper hand, open intrest on Bitmex has increased again the past days, so either bulls or bears have increased their positions again. So we might be closing in on a 200/300 point shake out move (just a guess). I think the shorts have increased, but difficult to be sure because we don't have that information unfortunately :(.
One thing is for sure, everyone has turned into a convinced bear, but for very good reasons of course. But markets is not about logic, so whatever you do, don't just sit back and relax. There will be shake out's sooner or later on either side.
- All the exchanges have been at the same price since yesterday. Maybe
- That last drop 10 min ago, was initiated by Bitfinex, think i have not seen that in months maybe.
- This is not your typical 1 min bear flag.
- Some dumping on Finex but while i am writing this, the support buying seems to have begun again on Finex. But, it could be short buying it back though, since short on Finex have dropped the past 24 hours. So if it's only that, than it's just temp buying support. Because it's not buying it's taking profit of short positions.
This is not something to trade on guys, just sharing some insights that might have no meaning at all, but IMO it is certainly something to keep in mind for the future.
Even if this rally would succeed, don't expect too much from it. It might nog even reach it's target around 6650. If we do drop, the 6200 should be a support level for the bulls, like we can see in the chart above from a month ago.
If, somehow, the bulls do show up and push this higher with real conviction and volume, before the end of the daily candle, it could mean a reversal. But it won't mean anything if we don't see volume. Because without it, it would probably mean it's mostly shorts closing and not real buying power.
I will try to post an update later or tomorrow.
So this complicates things a bit at the moment. I have no idea what kind of weight it has, assuming it even has some weight. If this drop really came from this news and we still stay above the 6200. Than the chances increase we will go up again. Because than it was probably just a small panic sell.
But i still not sure about the timing and what it actually means yet. So please do your own research about this before giving it real value.
Besides all this, the move is almost identical to a month ago so far. Bears are still in control, that is clear once again. The level to break is still the 6500/6500 (it's like i traveled back in time a month ago because i kept saying the same thing!). Or that bearish trend line might do the trick as well on the left chart around 6450/6400.
There was some bullish momentum at this small breakout, now it's almost completely gone again. Just no volume at all which is a bad sign. It should not drop below the triangle again.