Bitcoin is currently testing a convergence of two key support areas, here on the weekly chart. As you can see, BTC has printed a nasty bearish candle, which is sitting right on top of the 50% retrace for the 2019 bull market, as well as the 50 week moving average (in orange.) I think as far as immediate price action is concerned, this is pretty straight forward. If BTC breaks down below these levels, and closes this weekly candle below them, there is a strong possibility that we will see a continuation in selling pressure. However, if BTC is able to find support here, I think there is also a chance that we could see a nice rally.
One of the my favorite troll comments is "it could go up, it could go down." There is actually a lot of validity to that statement. Nobody knows for sure what will happen at any given moment. As traders, we have to react to support and resistance on the charts, once it is confirmed. Since BTC is currently testing key support, we have to see if it breaks or if it's held. In other words, we need to see some confirmation.
What I will typically do in times like this, is go long when there are early signs of a hold, with a tight stop loss in place below the support area. So, if I'm correct on the support trade, I will profit. If I'm wrong, I will be stopped out with a minimal loss.
You can see that there is a potential for BTC to turn to the upside to complete an inverted head and shoulders pattern. At the moment, there is absolutely zero evidence to support that, because BTC has not turned to the upside to begin completing the right shoulder. HOWEVER, if BTC does turn to the upside to complete the inverse head and shoulders pattern, we could see a powerful breakout to the upside that could propel BTC towards 20K. Interestingly, that narrative largely depends on BTC's ability to hold this support.
Don't forget, the downtrend remains intact! BTC did NOT take out the October 2019 high. It got close, but it didn't surpass it. Also, a higher low has not yet been formed. We still have a chart that has nothing but lower lows and lower highs. So, while many people are hoping for an upside breakout of the (POTENTIAL) inverted head and shoulders pattern, we need to keep in mind that the downtrend is still technically sound.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
One of the my favorite troll comments is "it could go up, it could go down." There is actually a lot of validity to that statement. Nobody knows for sure what will happen at any given moment. As traders, we have to react to support and resistance on the charts, once it is confirmed. Since BTC is currently testing key support, we have to see if it breaks or if it's held. In other words, we need to see some confirmation.
What I will typically do in times like this, is go long when there are early signs of a hold, with a tight stop loss in place below the support area. So, if I'm correct on the support trade, I will profit. If I'm wrong, I will be stopped out with a minimal loss.
You can see that there is a potential for BTC to turn to the upside to complete an inverted head and shoulders pattern. At the moment, there is absolutely zero evidence to support that, because BTC has not turned to the upside to begin completing the right shoulder. HOWEVER, if BTC does turn to the upside to complete the inverse head and shoulders pattern, we could see a powerful breakout to the upside that could propel BTC towards 20K. Interestingly, that narrative largely depends on BTC's ability to hold this support.
Don't forget, the downtrend remains intact! BTC did NOT take out the October 2019 high. It got close, but it didn't surpass it. Also, a higher low has not yet been formed. We still have a chart that has nothing but lower lows and lower highs. So, while many people are hoping for an upside breakout of the (POTENTIAL) inverted head and shoulders pattern, we need to keep in mind that the downtrend is still technically sound.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-