Major supports and potential reversal zones to watch out for BTC
Bitcoin has been making some strong moves lately in an effort to end the bear market, can it keep it going for one more leg up?
If we look at the chart we see that bitcoin successfully broke for the first time the resistance trend line (in red) forming the downtrend channel from the ATH 19.7k downwards.
The price also broke past the support trend line (in pink) formed from the Sept. 2017 low to the 6k low in February.
I mentioned in one of my idea updates that if there was a price surge, this would be a great spot to get it done by breaking through both major support and resistance trend lines at the same time.
Despite this, we have more obstacles to overcome and remember the fact that there hasn’t been a significant drop since this started from 6.5k.
The higher the price continues to go, the harder the fall will be after.
Look carefully at the chart and you can see the price has wicked down several times to touch the pink support trend line.
It seems to be holding up for now, but if it gets compromised the red trend line will act as the next minor support in combination with the .382 fib retrace.
The major support is the green zone below which is right under the .236 fib retrace in case price continues to fall.
If there is another leg up from here, the first minor resistance is the 0.5 fib retrace. The major resistance is above that highlighted by the red zone, directly below the 0.618 fib retrace.
If the price manages to get up to this point without any significant dip on the way up, then we should expect to see a strong reversal at this area.
Thanks for taking the time to read my analysis. Please like if you found this helpful =)
If we look at the chart we see that bitcoin successfully broke for the first time the resistance trend line (in red) forming the downtrend channel from the ATH 19.7k downwards.
The price also broke past the support trend line (in pink) formed from the Sept. 2017 low to the 6k low in February.
I mentioned in one of my idea updates that if there was a price surge, this would be a great spot to get it done by breaking through both major support and resistance trend lines at the same time.
Despite this, we have more obstacles to overcome and remember the fact that there hasn’t been a significant drop since this started from 6.5k.
The higher the price continues to go, the harder the fall will be after.
Look carefully at the chart and you can see the price has wicked down several times to touch the pink support trend line.
It seems to be holding up for now, but if it gets compromised the red trend line will act as the next minor support in combination with the .382 fib retrace.
The major support is the green zone below which is right under the .236 fib retrace in case price continues to fall.
If there is another leg up from here, the first minor resistance is the 0.5 fib retrace. The major resistance is above that highlighted by the red zone, directly below the 0.618 fib retrace.
If the price manages to get up to this point without any significant dip on the way up, then we should expect to see a strong reversal at this area.
Thanks for taking the time to read my analysis. Please like if you found this helpful =)
Comment:
Starting to drop now after struggling to make another leg up all day. The pink support line has been breached, let's see if it stays under. First target is at the .382 fib retrace in combination with red support trend line. A small retrace to this point will help Bitcoin make a larger move up, and might even go past my original target given above. Keep an eye on that red support trend line, if it falls below that then it could potentially continue down to the major support zone in green.
Comment:
Looks like the small drop I mentioned in my last update was pretty insignificant. Price just continues to climb upwards and so far it's tracking my pathway but again, we need to break above the 0.5 fib level to reach the major resistance zone above. With the slow pace and sideways price action, it seems inevitable that another big move will happen soon
Comment:
Still moving sideways and there's a lot of indecision in this region. Price is having trouble getting past the 0.5 fib level but at least it's still staying above the pink support line. On the 12 hour, 6 hour, and even 4 hour, the RSI is still extremely overbought and the fact that the price hasn't dropped more shows how strong the bulls are, as they are fighting to keep the price up and continue this rally. A drop soon would make the most sense given how far we have come, and a slight relief right now would help strengthen the momentum of this run to continue after.
If we stay above this pink support line however, chances are much higher that the price jumps for another leg up. Below I attached a snapshot of a potential ascending triangle pattern. Volume is decreasing throughout the pattern, which is typical in a consolidation period. These patterns are usually bullish, but anything can happen in this range and a drop is still very possible. Just like I mentioned earlier, a drop right now would most likely only bring us down to the red support line and we won't see a huge drop just yet.
If we stay above this pink support line however, chances are much higher that the price jumps for another leg up. Below I attached a snapshot of a potential ascending triangle pattern. Volume is decreasing throughout the pattern, which is typical in a consolidation period. These patterns are usually bullish, but anything can happen in this range and a drop is still very possible. Just like I mentioned earlier, a drop right now would most likely only bring us down to the red support line and we won't see a huge drop just yet.
Comment:
Wow! Just 1 hour after I posted the ascending triangle pattern, price just flew right through the resistance. This pattern ended up playing out perfectly and it's also following my green arrow pathway I drew on the original chart above. Now the next target is the major resistance above, as long as the price can stay above the 0.5 fib level which is very likely now with such a surge in volume. I am still calling for a drop around the major resistance zone especially since we didn't see a minor drop before this surge and now the RSI is going to be even more overbought than before. For now we keep tracking price movement and I'll update as we move along.
Comment:
Comment:
Price is no approaching the major resistance zone. If you scroll left to previous price action you can see why it's resisting at this point, right at the bottom of the zone I drew up. There is also the resistance line in green (not the arrow) that has been formed by the reaction highs of this rally. Once price pierces this resistance trend line, the price can drop anywhere in this red zone above.
Comment:
Looks like price hit the bottom of my major resistance zone by wicking up to it and is now falling pretty hard. It also hit the top of that green resistance trend line I just drew in the last update. As long as price can stay above the 0.5 fib at $9070, this drop won't be too big and price can still make another effort to the major resistance zone.
Alternatively, this was the test of this zone and failure to break through, and will begin to follow the red arrow pathway with first support at the pink trend line
Alternatively, this was the test of this zone and failure to break through, and will begin to follow the red arrow pathway with first support at the pink trend line
Comment:
First target is $9070 at the 0.5 fib retrace. As long as selling volume doesn't get too high, price should start to reverse at that point.
Comment:
We might not visit the 0.5 fib retrace after all, as the bulls quickly bought up that dip. Somewhat surprising considering the amount of selling volume, but not unexpected either given the market sentiment lately. Still on target to reach the major resistance zone above. Stay tuned
Comment:
The .618 fib level at the top of the major resistance zone around 9.7k has held price down so far as we are beginning to drop now. Targets are still the same on the downside, first the pink support line/0.5 fib, then the 0.382 fib level below that.
There is also a fractal that the recent price action has been following pretty closely. If this fractal plays out, then we should expect a second effort to break the $9.7k resistance first before a bigger drop takes over, following the red arrow.
Here is the possibility of this fractal playing out:
Obviously if the 9.7k breaks at any point, the chance of a drop happening now is much lower and I'll have to revise my plan
There is also a fractal that the recent price action has been following pretty closely. If this fractal plays out, then we should expect a second effort to break the $9.7k resistance first before a bigger drop takes over, following the red arrow.
Here is the possibility of this fractal playing out:
Obviously if the 9.7k breaks at any point, the chance of a drop happening now is much lower and I'll have to revise my plan
Comment:
After hitting resistance at the .618 fib retracement, it looks like the price found some local support with the pink support line (S1) and the 0.5 Fibonacci retracement. It seems like it’s trying to make a rebound from this point up, but I’m not sure if it will hold.
The selling volume so far has been very high and the market needs a relief after the big ascent from 6.5k up to 9.7k. Also, there is an outflow of money on this last ascent, if you look at the CMF (Chaikin Money Flow) on the 4 hour you will see a clear divergence. Remember what I’ve said in my last updates, that if the price just continues to rise up without any retrace, the drop will only get bigger when it finally breaks. So a break right now is a good thing to continue the bull run.
However, we do not want to drop too far from here. If price is able to break .5 fib and S1, the next support is the .382 fibonacci retrace. If this fails to hold up, the red trend line (S2) below will serve as next support and we wouldn’t want to see the price drop below here as this line defined the bear market and breaking out of it recently gave us strong indication that the market is now bullish.
Dropping below that line is dangerous, but if It happens we do have 2 last lines of defense with the .236 fib retrace and finally the blue support trend line below (S3). Getting this low however could change the market sentiment and question the integrity of this April rally.
Legend:
S1 = Support trend line formed from Sept 2017 low (2.8k) through Feb 2018 low (6k) and beyond
S2 = Resistance-turned-support trend line formed from the Dec 2017 high (19.7k) through Jan 2018 high (17k) to 11.7k reaction high.
S3 = Support trend line formed from Sept 2017 low (2.8k) through April 2018 lows
Close-up picture of current situation:
The selling volume so far has been very high and the market needs a relief after the big ascent from 6.5k up to 9.7k. Also, there is an outflow of money on this last ascent, if you look at the CMF (Chaikin Money Flow) on the 4 hour you will see a clear divergence. Remember what I’ve said in my last updates, that if the price just continues to rise up without any retrace, the drop will only get bigger when it finally breaks. So a break right now is a good thing to continue the bull run.
However, we do not want to drop too far from here. If price is able to break .5 fib and S1, the next support is the .382 fibonacci retrace. If this fails to hold up, the red trend line (S2) below will serve as next support and we wouldn’t want to see the price drop below here as this line defined the bear market and breaking out of it recently gave us strong indication that the market is now bullish.
Dropping below that line is dangerous, but if It happens we do have 2 last lines of defense with the .236 fib retrace and finally the blue support trend line below (S3). Getting this low however could change the market sentiment and question the integrity of this April rally.
Legend:
S1 = Support trend line formed from Sept 2017 low (2.8k) through Feb 2018 low (6k) and beyond
S2 = Resistance-turned-support trend line formed from the Dec 2017 high (19.7k) through Jan 2018 high (17k) to 11.7k reaction high.
S3 = Support trend line formed from Sept 2017 low (2.8k) through April 2018 lows
Close-up picture of current situation:
Comment:
This was the CMF divergence on the 4 hour I was referring to:
Watch for a cross and hold below the zero line, this will indicate more selling pressure and should see further price drops.
Comment:
S1(pink trend line) has now become resistance and price is hovering right around this area. It's possible we see some sideways action for the next 2 days, but as long as price stays under 0.5 fib level and S1 trend line, then more downside is likely.
Comment:
Just discovered this fractal, and it looks pretty interesting to see how close it follows so far. I doubt it will follow through the same way, but I still think it's worth sharing:
Comment:
Still sticking with my original target of 8.4-8.5k where the .382 fib level lies. Price is making a bit of upward movement, but the pink resistance line is right above and it should keep price down. Drawing a fib retracement from the high of 9.7k to the 6.4k low, we see the price struggling at the 0.236 fib and cannot push further up past it. This is helping hold back the price as well as the pink resistance line. If it breaks to the upside however, then we will have to reconsider this plan.
This newly drawn fib (in red) also creates a confluence with the original fib right around 8.4-8.5k with both .382 levels at this price range.
For now, be patient and keep your eye on that pink resistance line (still labeled S1 from when it was support). As I'm typing this, it looks like the new fib level (.236) has already resisted the price, so this is a good sign for the target to be reached.
This newly drawn fib (in red) also creates a confluence with the original fib right around 8.4-8.5k with both .382 levels at this price range.
For now, be patient and keep your eye on that pink resistance line (still labeled S1 from when it was support). As I'm typing this, it looks like the new fib level (.236) has already resisted the price, so this is a good sign for the target to be reached.
Comment:
The S1 breakdown that happened yesterday didn't last very long as the price continued to touch the trend line as resistance before shooting right up past it and past the 0.5 fib retrace a few hours ago. This was obviously a coordinated pump, and this kind of manipulation goes against all TA. The major resistance zone is still right above and we'll see if bitcoin can break through it this time. Chances are higher now that will happen given the fact that the S1 support line wasn't compromised for very long and is now acting as support once again.
However we cannot rule out any scenario, and we could see a second rejection at the .618 fib level followed by another drop. Therefore I won't cancel this trade idea until the .618 fib level gets broken.
However we cannot rule out any scenario, and we could see a second rejection at the .618 fib level followed by another drop. Therefore I won't cancel this trade idea until the .618 fib level gets broken.
Comment:
Sorry I haven't updated at all today, I've been very busy and my internet connection was giving me issues. Anyways, it looks like the price wasn't even able to re-test the .618 fib level at 9.7k and instead reversed exactly at the bottom of my major resistance zone (i knew it was a good idea to give this resistance area a range rather than a straight line). So looking below we see the price has already fallen below the strong pink support line (S1) and the 0.5 fib level. Next support is the 200 MA. I decided to add this to my chart recently because I couldn't figure out why the price reversed at 8660 yesterday and didn't continue to fall to the .382 fib level like my original prediction called for. Turns out the 200MA held the price up right around 8660 and so that becomes our first support if price continues falling. Below that will be my original target price range of 8.4k-8.5k right around the .382 fib level.
If price doesn't fall any further then pink trend line becomes resistance once again. It's interesting to see how Bitcoin is having trouble getting past this pink support line. Remember this trend line has been very important as it held the price up since September 2017 so I'm not really sure what to make of this constant criss-crossing above and below the line. Just seems like its a lot of fighting between the bulls and the bears but I don't know if it's really going to be that significant considering we have already left the major downtrend resistance line (S2) that formed the correction phase since December.
I'll update this again later as things move along, hopefully it becomes more clear to me.
If price doesn't fall any further then pink trend line becomes resistance once again. It's interesting to see how Bitcoin is having trouble getting past this pink support line. Remember this trend line has been very important as it held the price up since September 2017 so I'm not really sure what to make of this constant criss-crossing above and below the line. Just seems like its a lot of fighting between the bulls and the bears but I don't know if it's really going to be that significant considering we have already left the major downtrend resistance line (S2) that formed the correction phase since December.
I'll update this again later as things move along, hopefully it becomes more clear to me.
Comment:
Bitcoin is still having trouble surpassing the bottom of the major resistance zone. If it's unable to make a push up to .618 fib level again or even if it does and cannot break through it, this prediction is still valid and very much in play. 1st target remains the same around 8.4-8.5k.
One thing I want to point out is how this entire move up from 6.5k has been mirroring the price action on the 11.7k drop down to 6.4k.
If this continues to mirror the left side of the chart, then price is in the middle of finishing this W pattern just like the other side, and we will see a huge jump up. After all, that pink support line has been very resilient and I'm not really too sure it's going to let the price drop too far below it anymore. This area gets really tough to predict where price will go since we have strong resistance directly above and strong support directly below as well. It's getting squeezed into this wedge and a breakout can occur in either direction
One thing I want to point out is how this entire move up from 6.5k has been mirroring the price action on the 11.7k drop down to 6.4k.
If this continues to mirror the left side of the chart, then price is in the middle of finishing this W pattern just like the other side, and we will see a huge jump up. After all, that pink support line has been very resilient and I'm not really too sure it's going to let the price drop too far below it anymore. This area gets really tough to predict where price will go since we have strong resistance directly above and strong support directly below as well. It's getting squeezed into this wedge and a breakout can occur in either direction
Comment:
Sorry guys, meant to post this up last night but I wasn't home. Wishing I did now as it followed the pattern nicely. If this first .382 target for the Gartley fails, the next target is provided at the .618. Hopefully this helps you with reversal targets.
Comment:
Just posted a new idea. I'm not too sure about this one but right now this price ranging all weekend isn't helping us figure out any clear direction for this week and this is what currently makes sense to me.
Keep in mind rising wedge formations are typically unreliable patterns to trade, so proceed with caution on this:
Keep in mind rising wedge formations are typically unreliable patterns to trade, so proceed with caution on this:
Comment:
Price update: The rising wedge formation didn’t follow through, but a symmetrical triangle formation is still in play if price is able to stay above the 8.7k low (read below for more information). For now, let’s take a look at supports and resistances. We have broken the pink support line (S1) once again to become resistance, but I am not going to give much attention to this anymore unless it drops a big distance away from it since we’ve seen the price criss-crossing this trend line several times in the past week.
The strong points we need to focus on are the 200MA (in orange) above and the 0.5 Fibonacci retrace level above, both acting as strong resistance. If the price continues to be suppressed down by these 2 resistances then downside to my original target is still in play. I have been calling for a drop down to 0.382 fibonacci level around 8.4k-8.5k for over a week now and that has not changed.
My plan is to sit on the sidelines until we find a strong reversal point for going long again.
S1 = Support-turned-resistance trend line formed from Sept 2017 low (2.8k) through Feb 2018 low (6k) and beyond
S2 = Resistance-turned-support trend line formed from the Dec 2017 high (19.7k) through Jan 2018 high (17k) to 11.7k reaction high.
The strong points we need to focus on are the 200MA (in orange) above and the 0.5 Fibonacci retrace level above, both acting as strong resistance. If the price continues to be suppressed down by these 2 resistances then downside to my original target is still in play. I have been calling for a drop down to 0.382 fibonacci level around 8.4k-8.5k for over a week now and that has not changed.
My plan is to sit on the sidelines until we find a strong reversal point for going long again.
S1 = Support-turned-resistance trend line formed from Sept 2017 low (2.8k) through Feb 2018 low (6k) and beyond
S2 = Resistance-turned-support trend line formed from the Dec 2017 high (19.7k) through Jan 2018 high (17k) to 11.7k reaction high.
Comment:
Looks like the bulls tried making an effort to push the price up today. But still we look at the chart on the hourly and there is nothing but wicking above the 200MA and the 0.5 fib retrace level. 4 wicks but no candle body has been able to get itself above both resistances. If it continues having trouble getting past these zones, expect more downside tonight. On the other hand, a solid break above this resistance area could mean short-term upside to our next area of resistance. Stay tuned!
Comment:
Things are starting to get interesting now. After failing to break through the 0.5 fib level and 200MA yesterday, it finally broke upwards overnight. Now that price has touched the S1 support trend line, it has fallen right back down towards the 0.5 fib and 200MA again. Right now there is nothing but mixed signals and there really isn't much we can do except watch and wait for a clear signal. Next local support is the blue line below around 8.8k if it breaks this 0.5 fib level
Comment:
So after crawling up towards the S1 line, I thought we would see a small drop to 9k before a huge jump up and that was based on my latest idea of an ABCDE wave pattern within the wedge. Instead of dropping to begin wave E, the price just shot right up through what would have been the top of Wave D. Bitcoin didn't stop there and got all the way back up to the 0.618 fib level that held bitcoin down last week. We are at the top of the major resistance zone once again. Let's see if we can breakout from here:
Comment:
I just wanted to make it clear that if we fail to break through the resistance zone again, my original target of 8.5k range from over a week ago still remains valid. As long as the price stays under that .618 fib level then a drop is still in play, even if it took a bit longer than I expected. However, obviously if we break through this top then this trading idea will be closed and I will have a new update
Comment:
As I said above, if we cannot get above the major resistance zone, significant downside is to be expected. Here is my new idea update that supports this:
This is completely invalidated by a strong push up past 9.8k of course, so keep your eye on this!
This is completely invalidated by a strong push up past 9.8k of course, so keep your eye on this!
Comment:
-Bitcoin is approaching a critical area. There is a resistance trend line above that the price nearly touched today.
-Additionally, there is the 200MA on the daily chart that Bitcoin hasn’t been able to break upwards since the first 2018 rally in February. The price touched this point perfectly before slightly retracing.
-Also take note of the volume. Overall it has been on the decline since the start of this rally in April.
-Lastly, we still have the massive hidden bearish divergence on both CMF and RSI that is still very much in play.
If the bulls want to keep bullish momentum going, this area is crucial for them to break. If they cannot break it, all bearish indicators will prevail.
-Bitcoin is approaching a critical area. There is a resistance trend line above that the price nearly touched today.
-Additionally, there is the 200MA on the daily chart that Bitcoin hasn’t been able to break upwards since the first 2018 rally in February. The price touched this point perfectly before slightly retracing.
-Also take note of the volume. Overall it has been on the decline since the start of this rally in April.
-Lastly, we still have the massive hidden bearish divergence on both CMF and RSI that is still very much in play.
If the bulls want to keep bullish momentum going, this area is crucial for them to break. If they cannot break it, all bearish indicators will prevail.
Comment:
Finally got the drop I've been anticipating for 2 weeks now. For the short-term, we are looking at either a bounce here at this level or a continued drop to the 2nd target of my butterfly advanced harmonic pattern that I posted a couple days ago. Here is that chart:
Comment:
Price is now back in the major resistance zone. Keep an eye on the 0.618 fib level at 9700 once again for resistance. If the price cannot break here, then look for price to reach 2nd target of the butterfly harmonic pattern above.
Trade closed: target reached:
So I made this call way ahead of time, but still my target of 8.5k has been reached! I really did expect the drop to happen from 9.7k and not after a move up to 10k but still, it wasn't too far out of range of my major resistance zone so I'm happy with this one. Check out my latest ideas for new updates.