Bitcoin BTC has seen significant sell pressure & based on past patterns, without buy volume in equal amounts it will be hard to keep price action moving up. We are now oversold on the daily RSI for the first time since we saw a massive discount to 3K & it seems like we may have that opportunity once again around 6K as the economy stays in turbulence and BAKKT futures repeat the sell-off CME brought to us during the last bull run.
In recent price action, Bitcoin has rejected on the 200D MA & also isn’t bullish on the 4hr EMA (being below 40). I’d like to see price action above these levels before going long as we have now confirmed the 200D MA as a resistance level rather than a support.
If BTC can just go above the 200D MA then things may change to the upside however it doesn't seem like that's what it wants to do with a huge rejection today and no buyers in sight.
We are also in the weekend where manipulation is high so it’s going to be a matter of going above these levels until I see a good opportunity for a long position.
Looking at the overall market structure we are sitting in an empty zone where the price can very well head lower but there isn’t enough reward for a short in my opinion.
If we see any break down I think we may find some great discounts on BTC around the 7-7.5k level & possibly the 6-6.5k level depending on how much sell-off we see. Gold XAU is also not looking so good and has room for a correction so this may be time for BTC to also see it's healthy correction before continued upside.
With investors knowing the 3K level was an enormous discount, I believe we will see massive buy pressure around 6K especially with more institutions in the market than before. 2020 looks to be a great year and we will continue to update our TPC family as always, LIKE this idea to support my work, thank you!
Until we are above the 200 day moving average I will be short, I’d love to hear your thoughts in the comments below!
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We really need to get above the 200D MA soon to confirm this level as a temporary bottom. 4hr MACD is already exhausted and ready to swing back down so let’s see if traditional markets open this week will allow BTC to see the volume needed for the 200D MA to become support, rather than overhead resistance.
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BTC Update: When it comes to risk/reward, there’s a lot of upside potential and little downside for Bitcoin BTC. With Gold XAU opening & staying above support along with the weekend manipulation beginning to transition into market opening, I believe BTC holding above 8k shows strength for a potential breakout to the upside.
Our first target is below the 200D MA where we know there is resistance however let’s hope to move above this level and head back over 9k to confirm these levels as our temporary bottom.
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Bitcoin BTC Over 200D MA Update: We are now above a major level that can hold us as support and possibly indicate a temporary bottom for this new consolidation period we may enter.
Now let’s let price action mature by seeing a 4hr close above the 200D MA & preferably a daily candle close to confirm this as support.
The 200D MA can be a great support for this corrective wave allowing BTC to gain momentum over the next few months.
We caught some great entries with our signals and will continue to post more for our TPC family.
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BTC Short Term Update: We haven’t been able to close above the 200D MA, seems like we may stay in the zone for a bit.
We should be able to catch some good shorts / longs until we break above the 200D for good.
Thanks for the breakdown Naeem, based on your charts horizontal volume profile why would you no expect to see buyers come in around 649 since thats a high activity node? Also with regards to volume I don't disagree with your statement 'without buy volume in equal amounts it will be hard to keep price action moving up' but we should also take note that volume on red candlesticks can also be bullish in nature when its abnormally high relative to the size of the CS as this would indicate that its taking more effort to produce a smaller negative result/ buying is increasing
TradersProfitClub
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@TNasr, thanks for your response. I agree that we have good volume here and the good thing is we’re right below the 200D MA so if we can see some buyers take us above and it becomes support again then maybe this was the last of it. I agree this sell-off could be bullish but being below the MA & still in a downtrend it’s hard to be long let alone neutral. Today we rejected right off the MA as soon as buyers came and it was with heavy sell pressure & I like to use that price action to determine who’s stronger. Since the bears immediately brought it back down it leads me to assume that we need high buy volume to make it out of this slump which we have yet to see. With gold showing bearish signs breaking support and 1500 big even, there’s quite a bit of room for both BTC & gold to drop given their recent correlations. What do you think?
@TradersProfitClub, Personally I was trained by my EW mentor, Avi Gilburt to avoid looking for correlations so I can't thoughtfully link BTC to Gold or anything else. I don't deny correlations can exists but I think they are inconsistent, short lived, and I don't use them as a method of analysis. If we project Fibonacci extensions from the July 10 - 17 drop one sees we have met a 1.27 extension after a few months of consolidation. If we look at the structure of the drop we also see that it resembles and ABC much more closely than a five wave impulse; thus the move is corrective is likely corrective in nature. You are right in that its hard to be long at the moment but those can be the best times to go long. I don't see any bullish RSI divergence the way we did at the previously bottom in the 3000s which leads me to believe we could see a 'false' move up followed by a capitulation flush. Having said that things don;t need to happen in the same way. At the end of the day once 9000 breaks that will be a strong indication we've bottomed (from a EW analyst much better than me); all we can ever do is deal in probabilities,thanks for your quick response.
TNasr
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@TNasr, btw I have multiple TradingView posts on Gold in case your curious and will be posting a new one in the near future
TradersProfitClub
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@TNasr, agreed, that’s interesting because I’ve found a lot of success with correlations. I’ve used natural gas against a lot of pairs and same with gold.
TradersProfitClub
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@TNasr, with the weekend manipulation I believe we will see the confirmation on Monday.
dragononcrypto
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$6410 is what i measured the target of the breakdown to be... how not ironic looking at the volume profile.