Pls have a look at my previous analysis on BTC which I published at the beginning of December as this will give you a good foundation for this.
So we had two weeks of sideways action, some ALTS notably ATOM, XTZ and WAVES pumping and today boom, we go down.
The way I see it there are two possible scenarios:
1) Double bottom here similar to what happened back in July
2) Down to low 6000s
Both scenarios are valid. At this point we are defending a very important FIB level from BTC's ATH and double bottoms are very common reversal formations in crypto. On the other hand LONGS are at an ATH so this might be an irresistible liquidation territory for the BEARS. Also the low 6000s zone has massive confluence including bottom of current descending channel AND historical support from 2018.
I am leaning more towards scenario nr 2. My main concern is that once bears start to apply enough pressure all these longs will inevitably have to fold to cover their positions. Given longs at ATH this will inevitably cause a big price drop to wards the low 6000s.
Safe to say that currently all momentum indicators look bearish, however the way I see it is that no matter which of the two scenarious plays out BTC has a very good chance of hitting the top channel boundary which by then will be in the 8500 to 9000 zone.
Failure to hold the 6000 level would, IMHO, be catastrophic for BTC and would open the doors to a drop to 5000 at least.
Remember ADYOR!
So we had two weeks of sideways action, some ALTS notably ATOM, XTZ and WAVES pumping and today boom, we go down.
The way I see it there are two possible scenarios:
1) Double bottom here similar to what happened back in July
2) Down to low 6000s
Both scenarios are valid. At this point we are defending a very important FIB level from BTC's ATH and double bottoms are very common reversal formations in crypto. On the other hand LONGS are at an ATH so this might be an irresistible liquidation territory for the BEARS. Also the low 6000s zone has massive confluence including bottom of current descending channel AND historical support from 2018.
I am leaning more towards scenario nr 2. My main concern is that once bears start to apply enough pressure all these longs will inevitably have to fold to cover their positions. Given longs at ATH this will inevitably cause a big price drop to wards the low 6000s.
Safe to say that currently all momentum indicators look bearish, however the way I see it is that no matter which of the two scenarious plays out BTC has a very good chance of hitting the top channel boundary which by then will be in the 8500 to 9000 zone.
Failure to hold the 6000 level would, IMHO, be catastrophic for BTC and would open the doors to a drop to 5000 at least.
Remember ADYOR!
Trade active:
So scenario 1 aka double bottom can be ruled out...this is heading down fast.
Watch the 6000 to 6250 zone. If bulls fail to hold that then it's down to 5000 to 5300 pretty fast.
Remember always DYOR
Watch the 6000 to 6250 zone. If bulls fail to hold that then it's down to 5000 to 5300 pretty fast.
Remember always DYOR