Bitcoin Continues to Follow the February/March Fractal Pattern
Hi guys, got another update on Bitcoin’s outlook.
Since Bitcoin was unable to get past 8.8k to make the Bat Harmonic Pattern valid, I am reverting back to my original game plan which was to see a continued drop down to the major support zone.
3 weeks ago I posted a chart entertaining the idea that this entire April rally was repeating the fractal from February’s rally and March’s correction down. Here is the link to this: “ ”
So far it is following this fractal incredibly well, but I had to re-adjust the bar pattern slightly to better conform to the price action we have seen in April/May and now it is even more accurate now that we have more price action to go off of.
So looking at the past few days, it seems apparent that this movement up towards the R1 resistance trend line was just part of a larger bear flag from 10k down, just like we saw back in March.
But what’s really striking here is the fact that this fractal lines up so nicely with current trend lines and fib levels.
Looking ahead, if this fractal continues to play out we should expect some sideways action for the next 2 days before the drop continues and brings the price down to the major support zone which is between the 0.618 fib retrace of 10k down to 6.4k (in dotted red) and the 0.786 fib retrace of 11.7k down to 6.4k (in dotted black).
But first we need to break the S3 support trend line in orange.
Another thought I had which is just an idea, is that May should continue to be a bearish month based on the monthly cycles we have seen. December=Up, January=Down, February=Up, March=Down, April=Up, May=Down?? I’m not sure how long this cycle will continue but it’s holding up so far!
Trend Line Key
R1 = Resistance trend line formed from Dec 2017 high (19.7k) through 9.7k and 9.5k (April)
R2 = Support-turned-resistance trend line formed from Sept 2017 low (2.8k) through Feb 2018 low (6k) and beyond.
R3 = Support trend line formed from 8.5k (April) through recent reaction lows
S1 = Resistance-turned-support trend line formed from the Dec 2017 high (19.7k) through Jan 2018 high (17k) to 11.7k reaction high. This is an extremely important trend line, that defined the bearish 2018 downtrend
S2 = Support trend line formed from Sept 2017 low (2.8k) through April 2018 lows. This is another very important trend line in which the April rally sprung off from.
Since Bitcoin was unable to get past 8.8k to make the Bat Harmonic Pattern valid, I am reverting back to my original game plan which was to see a continued drop down to the major support zone.
3 weeks ago I posted a chart entertaining the idea that this entire April rally was repeating the fractal from February’s rally and March’s correction down. Here is the link to this: “ ”
So far it is following this fractal incredibly well, but I had to re-adjust the bar pattern slightly to better conform to the price action we have seen in April/May and now it is even more accurate now that we have more price action to go off of.
So looking at the past few days, it seems apparent that this movement up towards the R1 resistance trend line was just part of a larger bear flag from 10k down, just like we saw back in March.
But what’s really striking here is the fact that this fractal lines up so nicely with current trend lines and fib levels.
Looking ahead, if this fractal continues to play out we should expect some sideways action for the next 2 days before the drop continues and brings the price down to the major support zone which is between the 0.618 fib retrace of 10k down to 6.4k (in dotted red) and the 0.786 fib retrace of 11.7k down to 6.4k (in dotted black).
But first we need to break the S3 support trend line in orange.
Another thought I had which is just an idea, is that May should continue to be a bearish month based on the monthly cycles we have seen. December=Up, January=Down, February=Up, March=Down, April=Up, May=Down?? I’m not sure how long this cycle will continue but it’s holding up so far!
Trend Line Key
R1 = Resistance trend line formed from Dec 2017 high (19.7k) through 9.7k and 9.5k (April)
R2 = Support-turned-resistance trend line formed from Sept 2017 low (2.8k) through Feb 2018 low (6k) and beyond.
R3 = Support trend line formed from 8.5k (April) through recent reaction lows
S1 = Resistance-turned-support trend line formed from the Dec 2017 high (19.7k) through Jan 2018 high (17k) to 11.7k reaction high. This is an extremely important trend line, that defined the bearish 2018 downtrend
S2 = Support trend line formed from Sept 2017 low (2.8k) through April 2018 lows. This is another very important trend line in which the April rally sprung off from.
Comment:
Still following the fractal...We even got an identical spike up last night. Let's see if it drops back down to finally test the blue support trend line. Just like back in early April/end of March when we saw price jump up then drop the same amount a day later, I expect to see similar price action which is purposely done to confuse both bears and bulls before the real move occurs.
The fractal is still very much in play however, so the ideal situation is for this bounce off support to find resistance at the R1 trend line or .382 fib level (in red) and then fall back down again. If it takes the path of the fractal and also hits the .382 fib/R1 trend line then there could be a head&shoulders formation emerging, but as we all know H&S are very unreliable patterns.
If the breakdown of the S3 trend line does occur, the price should drop down to the major support zone very quickly. I think once the price gets to this major support there will be a pretty big bounce as many people are looking towards this area but I’ll keep my eye on it as we get down there.
I just want to let all my followers know, I’ll be travelling out west for vacation tomorrow and won’t be back until next Tuesday. I’ll try my best to update at night on my laptop, but I won’t be able to update frequently.