When Fibonacci Levels indicate it's not a trend reversal
MA50 going down - and acts as resistance
MA200 starts going flat and move sideways - and we are not that far away from it for a hard correction (compare it to april 13th where the high was twice the MA200)
Fib retracement levels can help us identify real trend reversals!
The basic rule of thumb is that if we did retrace over 0.786 level - it is a strong indicator for trend reversal and not just retracement.
Let's examine 3 cases:
1- Marking the first Fibonacci - marking April 14th high to April 25th close.
We can clearly see retracement to 0.618 level and rejection due to its resistance, all the way to May 11th that verified the bounce back down of it.
2- Marking the middle Fibonacci - marking May 12th high to May 19th close.
We can clearly see retracements to the 0.382 level and multiple rejections bouncing down of it. that itself is an even strong indicator for a more bearish trend.
3- Marking the last Fibonacci - marking June 16th and on.
We can clearly see retracement to the 0.618 level of this last fib (which oh so nicely coincides with the middle Fibonacci's 0.236 retracement level).
in all three cases - not crossing 0.786 strongly indicates that there is no real trend reversal.
in the short term for the last fib, anything higher of 38600 will indicate a weak first trend of reversal, mainly since that price level will still place us within the side walking trend.
Is it going to happen? My opinion is no. BTC will probably bounce down from MA50.
MA200 starts going flat and move sideways - and we are not that far away from it for a hard correction (compare it to april 13th where the high was twice the MA200)
Fib retracement levels can help us identify real trend reversals!
The basic rule of thumb is that if we did retrace over 0.786 level - it is a strong indicator for trend reversal and not just retracement.
Let's examine 3 cases:
1- Marking the first Fibonacci - marking April 14th high to April 25th close.
We can clearly see retracement to 0.618 level and rejection due to its resistance, all the way to May 11th that verified the bounce back down of it.
2- Marking the middle Fibonacci - marking May 12th high to May 19th close.
We can clearly see retracements to the 0.382 level and multiple rejections bouncing down of it. that itself is an even strong indicator for a more bearish trend.
3- Marking the last Fibonacci - marking June 16th and on.
We can clearly see retracement to the 0.618 level of this last fib (which oh so nicely coincides with the middle Fibonacci's 0.236 retracement level).
in all three cases - not crossing 0.786 strongly indicates that there is no real trend reversal.
in the short term for the last fib, anything higher of 38600 will indicate a weak first trend of reversal, mainly since that price level will still place us within the side walking trend.
Is it going to happen? My opinion is no. BTC will probably bounce down from MA50.
A nice green candle closing over the side walking highest high (above 41-43k).