Bullish bat pattern in the works, potential $7500-8700 swing

Full disclosure, harmonic patterns are not my bread and butter but we are nearing a potential bullish setup in Bitcoin. We are looking for a 0.886 retracement of the initial first wave (XA) that followed the ~$7200 bottom. This would be our buy target. Set a stop for just below that first bottom at X. This is usually not a high risk trade but because Bitcoin has so much bearish sentiment you should understand the risks before entering. The target is in the $8700 area, which is the area of the trendline formed by the two tops. This should be a conservative exit since usually the first target is the smaller of the two peaks in the formation. But it feels like people are quick to leting go of their positions recently. Risk reward ratio on this play is about 4.5. It's not a bad idea to move ascending stops in a conservative manner since people seem skiddish these days.

I'm still overall bearish, but this might be an interesting midterm play to try to make something out of this bear market. If we break south of point X, then we are headed towards a double bottom around $6k so hold out for that.

Let me know what you all think!

Peace and love,
crypt0guy

See this page for more guidance on the formation.

Comment:

Very steep descending wedge and 15 min RSI divergence could hint at a return to $8000 or even $8200 before continuing the trend. Estimated timeframe to reach target is between tonight and noontime tomorrow (EST).

Good luck!

Comment:

So, sure enough the descending wedge pattern and RSI divergence did lead to a break and BOY did it bounce. This will be interesting because the break was much more decisive than I imagined which might lead to higher numbers before a return down. Right now we are battling out around the 0.5 fib retracement. I have added another downwards trendline that may act as resistance if we see another move up. However, the price will likely gravitate towards that 0.382 retracement line which coincides with the 10-day MA. I expect this push to run out of steam around this area if it doesn't sooner. It won't take much more of a rise to invalidate this pattern but currently this pattern is still valid.

Comment:

Bullish bat pattern still in play. Currently a bear flag is forming. This will likely break downwards and head towards our target zone which has shifted slightly in time. It looks like this is the tail end of a zig-zag 5-3-5 correction. Segment CD is the final 5 move in which this flag formation is the 4th segment. The 5th segment of this move will bring us into the target zone.

Order cancelled:

This pattern has very obviously failed. Be on the lookout for an oversold bounce. That's about the only move there is right now.