We woke up this morning and witnessed something remarkable. Bitcoin has finally broken out of the descending Pitchfork channel. But will it stay out of the descending channel? To answer that question, we have to ask ourselves is this a whale creating a bull trap to sucker us into another fake rally? Or are we witnessing real buying for a change?
I have zoomed in on the activity of the past 3 days by using the 30 minute chart. The first item I'd like to draw your attention to are the white vertical lines that indicate 8:30 AM EDT. I noticed for the past 2 or 3 mornings when Wall Street opens (8:30AM), Bitcoin activity starts with a moderate amount of buying and it drives the price up (more buyers than sellers). But this does not look like a pump and dump to me. The whale pumps we've seen for the past 6 months had no finesse at all. The whale would shoot the price up or down 5% within 5 minutes causing huge price spikes. But that is not what has been happening since Tuesday. It appears to me that we are seeing legitimate buying for a change. First thing in the morning buying would start and then there would be a natural pull back, then more buying and another pull back. Higher highs and higher lows. The buying started slowly on Tuesday morning, then on Wednesday morning the buying picked up which caused the price to move up steeper and on Thursday morning the price went up almost vertically. There were far more buyers than sellers for the past 2 days, at least in the morning. This to me would indicate Wall Street is filling orders for their customers. Why else would they wait until 8:30AM before buying? Whales don't punch a time clock. I am concerned with Thursday's buying because there has been no pullback. It went up vertically and then it went sideways. We need to see a pullback for this move to remain healthy.
I drew a Fibonacci Retracement from the recent high to the recent low. Notice how well the price behaves within these Fib levels, finding support and resistance at various levels.
Where does the price go from here? As I mentioned before, I would like to see a pullback to the 0.236 Fib level (10,200) before the price moves higher. If there are too many buyers in the morning, then we may see a repeat of today's parabolic move. We have to be prepared for either. I do not want to see the price close below the red trend line on the daily chart. If it did this for more than 1 daily candle, it would mean the rally is over and the price has re-entered the pitchfork descending channel. We're not exactly out of the woods just yet, but the recent rally does look very promising. If the price stays above the 21 daily EMA, then I'm bullish. I like to enter trades like this where there are very clearly defined entry and exit points that are close to each other (within 3%). That minimizes the risk for the trade.
Well, that's it for today.
Don't forget to hit the Like button before you go out the door!
If the price stays out of the pitchfork channel, I will have to change the title. ;-)
I have zoomed in on the activity of the past 3 days by using the 30 minute chart. The first item I'd like to draw your attention to are the white vertical lines that indicate 8:30 AM EDT. I noticed for the past 2 or 3 mornings when Wall Street opens (8:30AM), Bitcoin activity starts with a moderate amount of buying and it drives the price up (more buyers than sellers). But this does not look like a pump and dump to me. The whale pumps we've seen for the past 6 months had no finesse at all. The whale would shoot the price up or down 5% within 5 minutes causing huge price spikes. But that is not what has been happening since Tuesday. It appears to me that we are seeing legitimate buying for a change. First thing in the morning buying would start and then there would be a natural pull back, then more buying and another pull back. Higher highs and higher lows. The buying started slowly on Tuesday morning, then on Wednesday morning the buying picked up which caused the price to move up steeper and on Thursday morning the price went up almost vertically. There were far more buyers than sellers for the past 2 days, at least in the morning. This to me would indicate Wall Street is filling orders for their customers. Why else would they wait until 8:30AM before buying? Whales don't punch a time clock. I am concerned with Thursday's buying because there has been no pullback. It went up vertically and then it went sideways. We need to see a pullback for this move to remain healthy.
I drew a Fibonacci Retracement from the recent high to the recent low. Notice how well the price behaves within these Fib levels, finding support and resistance at various levels.
Where does the price go from here? As I mentioned before, I would like to see a pullback to the 0.236 Fib level (10,200) before the price moves higher. If there are too many buyers in the morning, then we may see a repeat of today's parabolic move. We have to be prepared for either. I do not want to see the price close below the red trend line on the daily chart. If it did this for more than 1 daily candle, it would mean the rally is over and the price has re-entered the pitchfork descending channel. We're not exactly out of the woods just yet, but the recent rally does look very promising. If the price stays above the 21 daily EMA, then I'm bullish. I like to enter trades like this where there are very clearly defined entry and exit points that are close to each other (within 3%). That minimizes the risk for the trade.
Well, that's it for today.
Don't forget to hit the Like button before you go out the door!
If the price stays out of the pitchfork channel, I will have to change the title. ;-)
