First looking at the context on the weekly chart, RSI shows Bitcoin to be oversold, comparable to the momentum seen at the end of the 2015 crash.
Looking at the daily chart it gets even worse, no other time in history was bitcoin more oversold than it is today. Where does that leaves us now? Bitcoin has been ranging for the last couple of months before breaking its zigzag downwards. Last couple of days we have seen 3 impulse waves to the downside. Elliott will tell us it is time for a retrace. Looking at CCI, this behaviour is confirmed, three impulse waves have passed, each with lowering momentum than the subsequent one. RSI and CCI both clearly show price divergence. Volume has been spiking, which can only mean 1 thing, people are buying bitcoin! Buy the low, dont miss the boat.
"no other time in history was bitcoin -6.44% more oversold than it is today"
- Yes. And because of this, there never been more certain about the direction of the next price move
DeWit
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@Patladj., Trends do not keep trending forever. Momentum being oversold is a very efficient method of predicting price reversals. But if you want to sell when you see prices being oversold, be my guest.
Patladj.
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@DeWit, Look at the big picture. Techically is very bearish and still a long way to go. Oversold status in the lower timeframes, and oversold can become even more oversold as much as 50 % of the times that it can reverse.
I've been analyzing markets with historical data for years, and keeping an eye for oversold to buy was one of the first things to try in my long-time becktesting scenarios. At the end it leads again to 50:50%. May be 51:49% at most.
DeWit
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@Patladj., Yes you are absolutely correct. In the end it comes down to what kind of trader you are. I see myself more of a swingtrader. Although for the long term, I think that the indicated area holds as well. We might go lower, we might not. Risks versus potential profits.
Patladj.
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There is no way this can recover from what technical damage has been done to it.
- Yes. And because of this, there never been more certain about the direction of the next price move