The digital currency has been trading in a bearish parallel channel on the 4H timeframe for over 18 days and has just tested the upper trend line. Since April 6th is has been printing lower highs consecutively, indicating its clearly bearish on this timeframe. Price touched the 382 Fibonacci retracement of the swing low that started on April 6th and seems ready for another dive. Yesterday it tried to retest the previous high but lacked the strength to make a double top. We also have hidden bearish RSI divergence, which indicates underlying weakness. Traders will probably be looking to sell this high.
If so, then price might go for a retest of the low on April 14th, which happens to coincide with a strong daily support level. There we would have another decision point:
If so, then price might go for a retest of the low on April 14th, which happens to coincide with a strong daily support level. There we would have another decision point:
- it could bounce in which case we could have a double bottom after which price will go up and look to break the neckline (and in doing so, break out of the bearish channel): green dotted arrow
- it could break below and close below this support level in which case price would continue down the channel looking for new lows: red dotted arrow
You don´t need to be a weatherman to know which way the wind blows - B. Dylan
