One thing is clear, there is not a lot of buying going on the past days, since the is on the lower side. But we can also say that selling might be drying up. I can't say which one it is, but i think it's the last one.
I think it's safe to say, that mid-term buyers who might have bought around the 3500/3900 the past 2 weeks, are not selling while we are still above the 3500/3600 . As i mentioned several times lately, i don't think that zone will be an easy one to break. I think the channel on the left is actually a translation of this possible fact. For the ones who don't understand WHY we see an acceleration when certain support levels break, this is it. The 3500/3600 is such an obvious , that it becomes an easy buy and/or hold when we stay above that level. Just like we saw at the 6100/6200 zone. Everyone who was buying that zone, was selling like crazy when it eventually broke. This 3500 level is of course no where near as strong as the 6100 level, but it will still cause a lot of stops to trigger if the support breaks.
What games do whales love to play? That is making false breakouts. What i am trying to show with the red line. To be clear, i am not saying this will happen, but if we see that support line of the channel break, we will probably see an acceleration down which will also probably break the 3500/3600 . If we see a lot of panic selling happening but see some accumulation/buying going on as well at a certain level (my best guess is around 3200/3300) and start to see the forming of a V shape low. This scenario is just so genius and i know most people don't even know what is really going on when that happens. Too much to get in to right now, but i will try to make an educational post about it soon.
Back to business, for the short we are still moving inside this small between 3670/3750. We should have dropped 4 hours ago but out of nowhere a lot of buying power stepped in the market and saved the from breaking. This increases the chance for a Bart move, so be aware of this. I can't say yet which one it is, but the longer it takes the higher the chances for a Bart move. If this Bart move does happen, it will probably break the 3800 and move towards the 3900ish. If this Bart move happens, it could mean we will move to the upside again of this channel. If we don't see a squeeze happen, the 3800 will be a heavy for the short term and a key level between very movement or more slow and steady movement as this channel suggests.
So in summary:
- The red line is an assumption, being prepared in case the channel breaks, we make a big drop but start to see a lot of buying that pushes the price back in the channel again. This
scenario suggest a mid-term low, maybe even a long term low if we see a big rally happening.
- Same as the red line, but we don't see a big bounce at the low and stay below the 3500/3600, maybe even making a bigger flag. This would be very and we need to judge things again at that moment.
- A Bart move, if that is the case, we will probably move 6/12 hours like this and see a short squeeze above the 3900ish. If we see a bull flag-ish forming around that level, i think a short term low is set. A break of the channel is obviously important as well, but i think the 4050/4100 is the key level for now. I think a break of this level could give us much more upwards movement. If we see that happening, we would even have a potential big on the daily. The 4400 (previous high) is obviously an important level as well. But for me to become more bull than bear, the 4600ish will be the level to break. On the long term, anything below 4600 is still very .
So no clear path at this moment, since the has been turned into a possible Bart move. Since this extended has made things much more difficult to judge. As long as we don't see rallies of 150+ points, it will remain very .
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We also bounced up exactly from the low of that channel, so we can assume the upside of this channel might be a heavy resistance as well.
Anyway, as long as the price stays above the 3785/90ish, this bull flag could remain valid and we should see follow through above the 3900/3950.
If that level 3790 breaks, i would not trust the bull flag anymore
I did think this one would have had a very good chance, making at least another wave up, even if the short would have been bearish. But seems there are still no bulls to be found. Alts made bounces up but have given away almost everything again. So i have no other assumption at the moment than to think the blue line is in play here. On the right we can see a possible wedge and this pullback, but it should not have pulled back this much, so i am ignoring it but wanted to show it at least. So unless we see a miraculous move up above the 3840, bearish movement is to be expected.
On the left we can see a possible triangle in the making. At the moment i can not say with certainty how we will move, but i am quite sure the red movement will not happen. So for more mid-term bearish movement, we should see that triangle pattern form. If we do break the 3500ish, i think we will make that red line from my first chart, so a drop to prob max 3200/3300 and move up again.
For the green or purple to happen, we have to see a bounce up from around these levels, with a max of 3550/50ish.
The blue i just explained.
On the left we can see a possible bullish wedge, i don't like the shape of it to be honest, but it is there.
Still inside that channel on the left btw
The blue circles are the targets zones
So i am starting to get the feeling, that it should have dropped already, but since it is not dropping, something else might be going on. I think the 3660 is the first levels to break, 3700/30 the second. Otherwise have to assume we will drop and follow the red line from the primary chart
We just had a small bounce, but this is not the bounce that can should come with a panic low. Needs to be at least a 300 point squeeze. I think the red line scenario from the chart on the left will be very likely, but it's way to dangerous trying to catch that low. Unless we see a squeeze happen as mentioned above, we will simply continue to drop. So a 200 point squeeze won't do the trick as we have seen earlier today. 300 at least at the first wave.
Only a move above 3850 will get the bulls in the safe zone.
The red: speaks for itself.
Blue: Good strong breakout
Purple: A slow volume breakout, if that happens it wil most probably drop and reach the target anyway.
About making a low, after all this panic selling, anything below a 300 point squeeze, is quite sure to get dumped again.
When i look at the bear flag of Bitstamp, looks like a lot of buying has been going on there, but it's the only one though. The rest show decreasing volume in this bear flag (bearish signal). Alts are also still not showing any signs of life yet, so at least another drop towards the 3200/3150 has the biggest chance here.
I would keep an eye out on for that green support on left, if that breaks, the little bullish effect there is will probably be gone as well. Now the red line scenario (primary chart) was assuming some kind of V shape, but nothing to be seen yet.
Assuming the bear flag will break, we could make a bear trap move towards the 3200 or simply just drop to the 3050ish target. I can't say yet which one it is, can only judge it live
Now it's a coin toss about the next step. Only 2 scenario's i have in my mind, the ones mentioned above.
Bear trap around 3200 and up.
Or bear flag target (lowest blue circles) and up.
Only possible way to pinpoint a possible low, is seeing extreme dumping AND and even more extreme buying. If you don't know how to see this, i would not even try to catch the low.
There will always be at least 2 waves up if THE (temp) low is set. Safest is getting in during the bull flag after the first wave up. Catching the low is gambling if you don't know what you have to look at. Because there is simply no way of saying where this might end
If the bulls keep the bull flag alive, so making higher lows on the 1 min chart, we could see another jump up.
So these are the same 2 points as above. But on the left it's a 15m chart and the right a 3m chart