Bitcoin Cheat Sheet (Bottom and Long Term Outlook)
We are chopping around in a very strong support and resistance channel on low volume. For people looking for a long term hold, this is NOT the area to get into yet.
Instead, the plan as follows:
1) There is a chance of a breakout of the falling wedge but it might require some pretty heft raise in volume to get through the resistance at $3820.
In case of a successful breakout to the top - with a safety area 10% above it - it will be relatively safe to assume we entered a reversal.
In that case, we are getting into the buy zone #2 but setting a stop loss at $3720 and frequently update the stop loss as long as the trend points upwards.
Beyond $6060 levels, sentiment should be largely positive such that we can narrow the stop loss to way lower percentages from the actual price.
2) If due to low volume we are going to break down beyond the current strong support level and leaving the current channel, we will likely fall into a very heavy support zone between $2570 and $1820.
This zone will be so strong and hard to fall through (but breaking up, too) that we might see Bitcoin trading within this zone for quite some time before the reversal occurs.
I would consider this as the capitulation level and accumulation zone, with relatively little volatility and common "boredom" also known as "the bottom".
3) If we see Bitcoin leaving the heavy support zone below $1520, it could make sense to release parts of the previously accumulated Bitcoin as we will enter "The Abyss", with weak support, low volume and incredibly high volatility.
Personally, I don't see 3) happening, because this scenario would be way beyond capitulation and panic. But it will be good to have funds at hand if this case happens.
But also 1) is not that likely to me as we didn't see enough weak hands being washed out. There is still way too much positive sentiment combined with low volume to see a steady uptrend happening.
You can watch progression of this plan under this link:
www.tradingview.com/chart/n5I3Pfww/
Ethereum Donation Address: 0x285C0455D4B8c1b9e9D9f4a03bbFa130fEcD894B
Happy Trading!
Instead, the plan as follows:
1) There is a chance of a breakout of the falling wedge but it might require some pretty heft raise in volume to get through the resistance at $3820.
In case of a successful breakout to the top - with a safety area 10% above it - it will be relatively safe to assume we entered a reversal.
In that case, we are getting into the buy zone #2 but setting a stop loss at $3720 and frequently update the stop loss as long as the trend points upwards.
Beyond $6060 levels, sentiment should be largely positive such that we can narrow the stop loss to way lower percentages from the actual price.
2) If due to low volume we are going to break down beyond the current strong support level and leaving the current channel, we will likely fall into a very heavy support zone between $2570 and $1820.
This zone will be so strong and hard to fall through (but breaking up, too) that we might see Bitcoin trading within this zone for quite some time before the reversal occurs.
I would consider this as the capitulation level and accumulation zone, with relatively little volatility and common "boredom" also known as "the bottom".
3) If we see Bitcoin leaving the heavy support zone below $1520, it could make sense to release parts of the previously accumulated Bitcoin as we will enter "The Abyss", with weak support, low volume and incredibly high volatility.
Personally, I don't see 3) happening, because this scenario would be way beyond capitulation and panic. But it will be good to have funds at hand if this case happens.
But also 1) is not that likely to me as we didn't see enough weak hands being washed out. There is still way too much positive sentiment combined with low volume to see a steady uptrend happening.
You can watch progression of this plan under this link:
www.tradingview.com/chart/n5I3Pfww/
Ethereum Donation Address: 0x285C0455D4B8c1b9e9D9f4a03bbFa130fEcD894B
Happy Trading!