Bitcoin (BTCUSD) has been trading within a Falling Wedge pattern ever since the August 15 top. This analysis is on the 1D time-frame but we do incorporate the 4H MA50 (green trend-line) and the 4H MA200 (grey trend-line) to help us understand critical Resistance and break-out level.
** The Falling Wedge and the importance of the 4H MA50 ** What stands out here is that while Bitcoin is on Lower Lows (Falling Wedge), the 1D RSI has been on Higher Lows, showcasing a Bullish Divergence. However that is not enough on its own to start a rebound to the top of the Wedge. What is needed is a candle closing above the 4H MA50. We haven't had one since September 12, which was the previous High of the Wedge. Even before that, since August 15, we see that the candle never closed above the 4H MA50 and only when it did once (Sep 09), did the price rebound. As a result we should consider a closing above the 4H MA50 as a bullish break-out signal targeting the 1D MA50 (blue trend-line) and the top (Lower Highs trend-line) of the Falling Wedge, on the short-term term only. We can derive further confirmation if the 1D MACD makes a Bullish Cross again (last did on Sep 09, exactly when the rebound took place).
** The danger of breaking a Triple Support cluster ** The danger for BTC lies on the potential 1W MA300 (red trend-line) test. As long as the 4H MA50 keeps rejecting a break-out, the price should continue trading lower on the Lower Lows trend-line. Eventually that can test the 1W MA300 on the first week of October. Interestingly enough, this is where the current Support level is (17600), formed by the June 18 Low. If this Triple Support level breaks and the week closes below it, an enormous sell-off can taken place. During this 2021/22 Bear Cycle, it has been common for Bitcoin to fall within -45.50% and 55.50%, as the following chart suggests:
Assuming that the August 15 High was the start of such a sell-off, then a -45.50% move can be completed around 14000 while a -55.50% drop can be completed at around 11500.
What probabilities would you give to see those targets? Feel free to share your work and let me know in the comments section below!
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Even price go up 24k-25k will again come below 18k: don't fomo just relax and save ur money for Bull run ....For monthly expanses :buy only when price reverse from 5 down book profit & Enjoy
Tradersweekly
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@Amjadsid, I think so too. It is funny how 90% of these popular profiles predicted 10 out of 0 bottoms in the past year, with a new era of the bull cycle on the horizon every single week.
Amjadsid
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@Tradersweekly, this guy @TradingShot works very hard to predict btc price: comparisons, different indicators, MAs etc he embed too many indicators and doesn't draw any conclusion : if he focus and master of few indicators he can do better : for example he draws RSI support line but misses both buys on RSI Divergence :)
Tradersweekly
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@Amjadsid, Well, working hard and making accurate predictions are two different things. Just in the month of September, I saw this person predicted 34k USD for DJIA and a bull cycle for BTC (despite the FED raising rates and slowing economy). That makes me wonder whether this person has any clue about basic economic concepts, not to talk about TA. Predictions are way off, despite him/her working hard. Indeed, I would argue that many of these predictions are ridiculous and contain little to no regard for what is happening in the real world. For someone with alleged 20 years of experience (as TradingShot states on his/her website), I would say charts and ideas are pretty bad - equal to those of an average retail trader who did not spend much time studying the market and economics. Additionally, I would not expect someone with 20 years of trading experience to change his/her mind every second week (jumping from overly bearish to overly bullish, back and forth); a person that does that, has no clue about trading and markets... and I guess there is no need to talk about providing trading signals, which this person does. On the endnote, it is the same person that was talking about continuation of the uptrend in September 2021 (right prior to the top), and then rather went quiet for a year.
I think given the current Ukraine/Russia situation we are at about 80% probability of seeing BTC at 12k or under. Ukraine has embarrassed Russia with their resolve and the will to take back their country. However Putin is a very proud man. Anyone who is thinking he's going to eventually back off or even stay on the current course is deluded. So we still have plenty of turmoil to come in all markets, and that's only considering the Russia Ukraine situation. There are plenty more reasons such as the current recession (Yes we are definitely in one and it's not scheduled to end yet). Housing market collapsing and the feds continue to increase the rates which means the housing market doesn't stand a chance. The list goes on... Yup, at least 80% I think.
JoyBoyVegae
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Not bottom, it’s still too soon and early to say we are bullish from 17,600 area. Because of the Feds increase another interest hikes, still have an eye on 12K or lower of 10K has stronger support floors
Tradersweekly
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Do you still think BTCUSD entered a new bull cycle, as you stated two weeks ago? Here are my thoughts: