What if that price movement was a dead cat bounce?
Market price made a crazy 3000 $ up movement after FOMO news from china. For me this wasn't a healthy up movement because it was way to fast without any correction. If I take a look at the daily chart this movement was dead cat bounce textbook movement.
What is a dead cat bounce ?
If a price has been in a trend direction for some time (bitcoin is in a downtrend since June) and then make a very strong but not sustainable correction movement we can speak of a dead cat bounce. As a rule, the correction movement is about 50% of the original trend movement, which fits very well in this case. The correction movement is then usually followed by the original trend movement again (i. e. further downwards here).
Such movements are often triggered by large investors in order to be able to sell larger investment amounts at higher prices.
should the market price not jump above the $ 10000 mark within the next week I expect further downward movements in the medium term as shown in the chart.
I don't recommend to open long or short because the market is currently unpredictable. I'm waiting for a clear signal.
Buy signal:
Breakout over $10000 with subsequent support confirmation
Sell signal (dead cat bounce confirmation):
The market forms lower and lower highs and falls below 8700 $ again
What is a dead cat bounce ?
If a price has been in a trend direction for some time (bitcoin is in a downtrend since June) and then make a very strong but not sustainable correction movement we can speak of a dead cat bounce. As a rule, the correction movement is about 50% of the original trend movement, which fits very well in this case. The correction movement is then usually followed by the original trend movement again (i. e. further downwards here).
Such movements are often triggered by large investors in order to be able to sell larger investment amounts at higher prices.
should the market price not jump above the $ 10000 mark within the next week I expect further downward movements in the medium term as shown in the chart.
I don't recommend to open long or short because the market is currently unpredictable. I'm waiting for a clear signal.
Buy signal:
Breakout over $10000 with subsequent support confirmation
Sell signal (dead cat bounce confirmation):
The market forms lower and lower highs and falls below 8700 $ again
Trade closed: target reached
The analyses provided are for informational purposes only and do not constitute financial advice or recommendations to buy or sell anything. The information presented is based on personal research and interpretation.
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