BTC is hovering above a strong support zone comprised of the .786 long term Fib, .236 intermediate Fib and a VERY high volume support (brighter orange box).
Beneath it are additional proven supports:
- Solid horizontal support @ 6000
- Baseline support that's been intact for almost a year
- Critical horizontal support at 5745
Volume has been decreasing for the last 45 days or so minus a few sporadic bursts. Notice on the 120 that in between bursts, the trend during low volume trading has been down.
In a few hours Eastern markets are going to react to this low volume downtrend. The challenge is that their reaction is unpredictable.
I believe there will be an initial period of panic selling, dropping the price into the strong support zone where it will consolidate before heading back upwards.
On the other hand, Eastern markets could reverse and burst upwards. How strong of a burst will determine how high it goes and whether or not it'll break above what I believe to be a significant amount of overhead resistance.
Another possibility is that the Western markets make a push for it before the Eastern markets get a chance to react. Once again, unless the price is pushed above the overhead resistance, Eastern markets will thank us for the effort (and higher profit) before beginning the selloff at a higher price.
Beneath it are additional proven supports:
- Solid horizontal support @ 6000
- Baseline support that's been intact for almost a year
- Critical horizontal support at 5745
Volume has been decreasing for the last 45 days or so minus a few sporadic bursts. Notice on the 120 that in between bursts, the trend during low volume trading has been down.
In a few hours Eastern markets are going to react to this low volume downtrend. The challenge is that their reaction is unpredictable.
I believe there will be an initial period of panic selling, dropping the price into the strong support zone where it will consolidate before heading back upwards.
On the other hand, Eastern markets could reverse and burst upwards. How strong of a burst will determine how high it goes and whether or not it'll break above what I believe to be a significant amount of overhead resistance.
Another possibility is that the Western markets make a push for it before the Eastern markets get a chance to react. Once again, unless the price is pushed above the overhead resistance, Eastern markets will thank us for the effort (and higher profit) before beginning the selloff at a higher price.
Trade active:
Right when I posted this there was a sharp uptick in volume. The volume on the 240 may meet or exceed it's moving average heading into the handover to the Eastern markets. Conversely, volume on the 480 and daily aren't on track to meet their moving averages which makes it very hard to gauge if this volume will be sustained and price will push higher or if it's a quick pump about to get dumped.
Comment:
Trending downwards. Unless some major buying action kicks in, it appears BTC is going to test the strong support zone.
Trade active:
Price tested the strong support zone and immediately reversed setting up a nice hammer on the 240 with a burst in volume that superseded the previous 22 candles. This is a very bullish sign and I expect upward movement moving forward if the volume keeps up. ~7000 would be a reasonable target.
Trade active:
Volume dropped off and once again, low volume reverts to the trend which is down. Price is well within the strong support zone where it is consolidating.
Trade active:
Daily closes in ~40 minutes and if this rally hold/maintains >6500, it sets up a hammer reversal candle well above the short term trend line.
Trade active:
Strong reversal on daily hammer in effect.
Trade active:
7000 is now a support. Buy at 7000 and they'll be a retest of 7700.
Comment:
Target sell zone is $7400-$7600
Trade closed manually:
On Oct. 15th concerns about Tether (USDT) caused a buying frenzy on Tether based exchanges, rocketing the price to ~$7700 while USD based exchanges topped out ~$6800 during the same session, a spread of ~13%. Currently there's a BTC price differential of ~4% between USDT backed Binance and USD backed Coinbase. BTC prices eventually need to equalize and I believe USDT based exchanges will see steeper declines/slower gains in price until USDT concerns are addressed. This equalization will affect alts that are Tether based the most.
This equalization is going to take time so there'll be ample opportunity to make transitions/adjustments. I've been criticizing Tether since Nov. of last year and seeing how many of the Asian exchanges are USDT based, I've accepted that Tether is almost "too big to fail." If it did, it would be catastrophic so all crypto exchanges have a vested interest to ensure any Tether concerns are handled to assure traders that their markets have integrity. It goes without saying that USDT exchanges are seeing record profits (Binance projects $1bil of profit in 2018). Tether's market cap is ~$2.4bil and even if it's not backed 100% as they claim, Bitfinex, Binance and other USDT exchanges will provide a solution for those holding Tether on their exchanges. If not, it would be their demise. As a consultant to very wealthy business owners, I couldn't imagine any owner/management group of an exchange letting it go to waste over Tether. Gemini created their own token based on USD (GUSD) and I wouldn't be surprised if other exchanges did the same.
Back to my analysis, the 4 hour candle has been steadily dropping as I write this and there could be a *short term reversal* at the following prices: $6680 +/- $20, $6630, $6595 and lastly at a strong support ~$6470.
Technically the latest move upwards shows bullish signs. However when evaluating BTC/USD charts, it's still trading within a bearish triangle and this latest move tested the upper trend line. I expect the overall trend to continue downwards with enthusiastic bursts of those who think we're set for an end of year bull run. While I'd love to see that happen, I'm skeptical as market manipulators tend to throw curveballs and those who believe the bull run at the end of 2017 will repeat in 2018, I would tread carefully and expect the year to end bearish before the bulls show strength in 2019.
Lastly, a lot of USDT reserves were expended on Oct 15th. If the trend breaks/continues bearish, a lot of those buyers will cut their losses, dropping the market further. With that being said, I don't see USDT markets breaking $7000 unless Tether comes out with some really positive news like a proper audit accounting for the vast majority of their token being backed. I highly doubt that will happen but this is crypto where the seemingly impossible can and has been possible.
This equalization is going to take time so there'll be ample opportunity to make transitions/adjustments. I've been criticizing Tether since Nov. of last year and seeing how many of the Asian exchanges are USDT based, I've accepted that Tether is almost "too big to fail." If it did, it would be catastrophic so all crypto exchanges have a vested interest to ensure any Tether concerns are handled to assure traders that their markets have integrity. It goes without saying that USDT exchanges are seeing record profits (Binance projects $1bil of profit in 2018). Tether's market cap is ~$2.4bil and even if it's not backed 100% as they claim, Bitfinex, Binance and other USDT exchanges will provide a solution for those holding Tether on their exchanges. If not, it would be their demise. As a consultant to very wealthy business owners, I couldn't imagine any owner/management group of an exchange letting it go to waste over Tether. Gemini created their own token based on USD (GUSD) and I wouldn't be surprised if other exchanges did the same.
Back to my analysis, the 4 hour candle has been steadily dropping as I write this and there could be a *short term reversal* at the following prices: $6680 +/- $20, $6630, $6595 and lastly at a strong support ~$6470.
Technically the latest move upwards shows bullish signs. However when evaluating BTC/USD charts, it's still trading within a bearish triangle and this latest move tested the upper trend line. I expect the overall trend to continue downwards with enthusiastic bursts of those who think we're set for an end of year bull run. While I'd love to see that happen, I'm skeptical as market manipulators tend to throw curveballs and those who believe the bull run at the end of 2017 will repeat in 2018, I would tread carefully and expect the year to end bearish before the bulls show strength in 2019.
Lastly, a lot of USDT reserves were expended on Oct 15th. If the trend breaks/continues bearish, a lot of those buyers will cut their losses, dropping the market further. With that being said, I don't see USDT markets breaking $7000 unless Tether comes out with some really positive news like a proper audit accounting for the vast majority of their token being backed. I highly doubt that will happen but this is crypto where the seemingly impossible can and has been possible.
Comment:
BTC had a short term reversal at $6678, tried to put up a fight at $6630 but failed, a very weak reversal at $6595 and after the last daily candle close is already heading down towards the $6470 level where I expect a short term reversal before it bottoms out at $6240. The next series of key reversal levels are $6470-$6267, $6000 then the critical support at $5750.
Comment:
Reversed at $6510, however the last 8 hour candle had extremely low volume (2.5k) which is 75% less than the moving average. The prior 8 hour candle was a gravestone doji and should have sent the price down. Despite the fact that it kept rising, low volume signifies weakness and I expect bears to easily drop the price down again unless buying volume picks up.
Comment:
And just like that, BTC pumped 0.5% with a whopping 150 BTC of volume. There's no follow through and watch the Bears feast on those who don't respect the power of volume. Lately I've noticed a sharp pump before a dump and vice versa. This latest move would setup a proper drop.
Comment:
Low volume upward movement continues. I believe it's a trap. Upward reversal points are $6680, $6710, $6758 and $6824 though I doubt BTC will stay above any of those levels for long. In my opinion, volume is the most important indication of market psychology. When BTC dropped 5.65% in a single 8 hour candle on Oct. 10th, then exploded 21.6% on Oct. 14th in the same timeframe, the volume supported the moves because the market panicked (24k of BTC volume down) and Tether fears (43k of BTC volume up) substantiated the movement. What is happening now is exactly what a trap is supposed to do: move the market using a fraction of what it normally would, let fear of missing out (in this case) increase the volume to "substantiate" the move and when the guillotine drops, buyers will scratch their heads and wonder how they got trapped because in hindsight the volume will look justified after the FOMO buyers bought in after the low volume upswing. That's why looking at history can be misleading, because in a 4, 8 or 24 hour period, volume summary doesn't necessarily tell the story accurately. That's why in a lower volume environment there's more movement before a candle open/closes. I wouldn't be surprised if BTC tests any one of those reversals I listed above and it'll likely happen before the Asian market open on Monday morning. I also wouldn't be surprised if BTC drops swiftly before an 8 or 24 hour candle open/closes sometime on Monday. Asia generates the volume. Volume solidifies moves, hence why this upward low volume movement is a trap. Patience here is key. While some money can be made anticipating the trap, I wouldn't risk it. In Chess the pawns go first. Let them be sacrificed, wait for a better structural setup then trade off of that.
Comment:
Asian market open... down 1%. 1000 BTC of volume in the last hour. $6576 might hold for a bit and even have a slight reversal but over the next 24-36 hours I see this retesting $6510. Volume is the most important indicator. Another is what the alts did when BTC started to drop. For the most part, they stood pat thinking BTC was going to hold and now that people are starting to realize BTC lost its support, alts are selling and will drive the price of BTC down further. The Chicago Bears might have lost to the Patriots today but the market bears are feasting tonight.
Comment:
The current 10 day bottom trend line (only 2 anchors) intersects with a 402 day bottom trend line that was breached on Oct. 10th. They intersected 9 hours ago at $6515. Between that point and my call on Friday for a drop to $6570, that may be an attractive zone to partially reenter as I see a strong likelihood of a reversal that will hold for the short term. Be prepared to sell for a quick profit or for a small loss in the next few days depending on market volume. As I type this BTC appears to be reversing. It's an illusion unless it *closes* above $6600. The volume that drove it upwards was 50 BTC in the last 15 minutes, a pace of 1600 BTC over 8 hours... that's nothing compared to the last 30 8 hour candles that averaged 8800 BTC. We just started a new 8 hour candle ~50 minutes ago. It looks like it will continue to climb and may even break above $6600 for a while. The bears will maintain a resistance ceiling to sell off at a more attractive level before driving the market down further. Additional confirmation of this is that the alts aren't buying this reversal and by the time they do, watch for BTC to drop again and trap the alt buyers.
Comment:
Alts still aren't buying this reversal but they'll come around slowly if and when BTC enters the following zone: $6610 to $6645. The next 4 hour candle closes in 2.5 hours. If it closes at or above $6600, it'll form a hammer doji and enthusiasm will drive the price higher before it reverses downwards. Low volume 4 hour candles little insight into the next few 4 hour candles (if that) so patience is key. The overall structure is very much downwards and buying volume is still abysmal.
Comment:
The 4 hour candle closed forming a doji. Volume outpaced the prior 4 hour candle almost 2:1 and at this pace halfway through the current 8 hour candle, it is going to fall short of the moving average by about 25%. Normally a doji forming here would be further validated with a nice green bodied candle with small wicks finishing above $6650 and I'd expect some upward movement from buyers who are excited to see this doji and are willing to buy without confirmation. However, there's significant overhead resistance right above at $6680, $6710, $6758 and $6824 so if one were inclined to buy right now, they're exposed to the rally simply stalling and plummeting and if the next 4 hour candle closes above $6650, providing further validation to the last doji that formed, there's a lot of overhead resistance to overcome. In other words, not worth the risk for such small profits, even if the purchase and sales are timed perfectly.
Just now a buy limit of 80 BTC was taken within seconds of it being placed. The 20 BTC buy limit behind it quickly withdrew when sellers started taking a bite out of it. It may not look like it takes me long to write these but I started this right after 4 hour closed and here we are 30 minutes later. In order to get a better pulse on the market, I am constantly checking a variety of factors while typing blind. BTC just entered into that zone I mentioned in my prior comment ($6610-$6645) and now alts are starting their rallies. In the alts I'm watching, they're about to hit significant resistance and like I said before, the buyers who are going to be hit the worst are the ones who are buying alts without any validation other than BTC is going up despite volume dropping off.
Just now a buy limit of 80 BTC was taken within seconds of it being placed. The 20 BTC buy limit behind it quickly withdrew when sellers started taking a bite out of it. It may not look like it takes me long to write these but I started this right after 4 hour closed and here we are 30 minutes later. In order to get a better pulse on the market, I am constantly checking a variety of factors while typing blind. BTC just entered into that zone I mentioned in my prior comment ($6610-$6645) and now alts are starting their rallies. In the alts I'm watching, they're about to hit significant resistance and like I said before, the buyers who are going to be hit the worst are the ones who are buying alts without any validation other than BTC is going up despite volume dropping off.
Comment:
And just like that, 4 hours of gains are wiped away in the first 30 minutes of the new 4 hour candle. The last 8 hour candle closed indecisive with more wick than body and 33% under the volume average. Without any sustained buying volume from the bulls, it's apparent the bears are in control and will continue to push the price lower.
Comment:
Daily, 4 and 8 hour candles close in 2 hours. Upward movement has been rejected by a 6 day trend line while volume still remains below the moving average for all time frames. Low volume environments are torturous because it takes a long time for the market to develop and it's easier for market manipulators to retain those who bought false breakouts because they think that if they wait a little longer, they can break even or maybe even turn a profit at the next breakout. That's why it's so difficult to make profitable low risk trades because in the last 48 hours we've had lower highs and lower lows. To put it in perspective, if a buy was made at a lower low then sold at the next lower high that's less than 1% profit for any of those cycles in the last 48 hours on Binance. Minus fees and the fact that very few will time it perfectly, it's a recipe for most people to fail. Sure alts have better spreads but the sword cuts both ways. There's a reason why ATH BTC is down 66% vs. ATH alts are down 90+%.
Back to the analysis. All signs point to a steep selloff. If price drops before close, yesterday's gravestone doji is valid and BTC will continue to fall. If price holds till close, it'll form a daily double doji (actually worse because the first doji was a gravestone) and if that doesn't spark an immediate selloff, it might hang around for another day where a triple doji forms and then the selloff will commence. The only way BTC doesn't sell off is if the bulls manage to break multiple heavy resistances with strong, sustained volume. I highly doubt that will happen as most buyers blew their wad on Oct 15th, are likely in the red and are looking to breakeven/sell for a small loss. On the other hand if the market drops, some of those buyers will cut their losses and contribute to a steeper decline, triggering stoplosses and sending the market into a tailspin. I said previously that BTC was headed down to $6470, reversing short term before bottoming out at $6240. Given the way everything has played out, BTC just might blow right by it and test $6240-$6300 (adjusted for bottom trend line ascension).
P.S. Check out the daily double doji on Oct. 16th and 17th. Oct 19th BTC dropped 2.5% and put us in the structure we're in now.
Back to the analysis. All signs point to a steep selloff. If price drops before close, yesterday's gravestone doji is valid and BTC will continue to fall. If price holds till close, it'll form a daily double doji (actually worse because the first doji was a gravestone) and if that doesn't spark an immediate selloff, it might hang around for another day where a triple doji forms and then the selloff will commence. The only way BTC doesn't sell off is if the bulls manage to break multiple heavy resistances with strong, sustained volume. I highly doubt that will happen as most buyers blew their wad on Oct 15th, are likely in the red and are looking to breakeven/sell for a small loss. On the other hand if the market drops, some of those buyers will cut their losses and contribute to a steeper decline, triggering stoplosses and sending the market into a tailspin. I said previously that BTC was headed down to $6470, reversing short term before bottoming out at $6240. Given the way everything has played out, BTC just might blow right by it and test $6240-$6300 (adjusted for bottom trend line ascension).
P.S. Check out the daily double doji on Oct. 16th and 17th. Oct 19th BTC dropped 2.5% and put us in the structure we're in now.
Comment:
Remember, there's usually a sharp spike before a major move.
Comment:
BTC has dropped to an 11 day bottom trend line. This trend line was anchored by 2 points, one before the Tether concern buy and the other was reversal of the buying frenzy so I wouldn't put much weight on it holding. Technical analysis can only do so much and when the most widely used USD equivalent raises concerns, all the prior analysis must be taken with a grain of salt. That's why some of the numbers I'm talking about don't show up on either of these charts. People will still trade off of prior data which is why BTC is trying to reverse right now. When taking inflated USDT values into consideration, the BTC price on Binance is trying to reverse too high. This is why trying to buy rock bottom is risky and so difficult to do. The extra profits lost by sacrificing the pawns is well worth it knowing that properly structured trades will have a higher likelihood of profitability in a shorter time frame.
An important question to consider: when the Western markets begin trading and they see the daily double doji and all the other bearish signs I've explained here, who in their right mind would want to counter the trend and buy when there's such a strong selling sentiment?
An important question to consider: when the Western markets begin trading and they see the daily double doji and all the other bearish signs I've explained here, who in their right mind would want to counter the trend and buy when there's such a strong selling sentiment?
Comment:
BTC is trying to reverse off of $6517 after having done so at $6507 on Oct. 19th. Volume looked great on the last 30 minute candle that formed a hammer but the current one is clearly lagging behind. A close at or below current price in ~30 minutes for the 4 and 8 hour candles signifies downtrend continuation.
Comment:
After the last update price closed around the same price, signifying downtrend continuation. The following candle formed a doji which led to a short term reversal up to $6630. Since then price has declined along with volume. Currently price is right back where the price closed which further confirms the downtrend continuation. Right as I wrote that, BTC dropped to $6500 so I'm getting back to work. Remember the levels I posted and let the pawns go first.
Comment:
In an hour the daily candle will close to finish the week. If price closes below $6550, it will have closed under the 408 day bottom trend line. The only days it closed under that trend line was from Oct. 11th to 14th when BTC tanked and yesterday.
While markets are capable of movements that defy technical analysis, decisions and plans derived from it will reduce risk and increase profitability over the long term.
Here is my summary of the last 7 days based on the daily candles:
- There were 4 doji, 3 of the gravestone. The formation and wick/body ratio are similar to those found on shooting stars. While shooting stars are spotted at a peak signaling a reversal downwards, the Tether panic buying rally has skewed the level at which the candles trade at. When compensating for the breakout, these shooting stars would be trading near the peak of the latest move and at the top of symmetrical triangle.
- Volume has been ~50% below the 30 day moving average. There are 2 main reasons for this: 1. A lot of money on the sidelines was expended on Oct. 15th and hasn't been liquidated until the market moves decisively. 2. Many believe the price is too high and is going to drop. This market could break either way with higher volume and there's plenty of pros on Trading View who will give you both sides of it then claim they were right when the market moves within their set range. While that's good information to have, it's presented as a coin flip and doesn't provide strong analysis to setup trades with strong risk/reward ratios.
- On that note I'll provide some insight that to better access the market and I've yet to see this anywhere else. I wanted to know how the volume was split between buying and selling since Oct. 15th. At the $6900-$6714 level, 111,354 Bitcoins were traded over 2-3 days. Buying volume accounted for 49.88% vs. 50.12% for selling. Pretty even. At the $6713-$6500 level a total of 131,836 Bitcoins were traded over 8-9 days. Buying volume was 44.13% vs. 55.87% of selling volume. Over the last 7 days the most of the trading occurred in a corridor of 1.36%.
I've heard plenty of people talk about how this is a consolidation before an upward move. Based on this data, I'd argue it's a consolidation before a downward move. Combined with my technical analysis, I'm further convinced that the next major move will be down. $6000 to $6300 would be an acceptable drop if the support holds. Beneath that, $5750 is a critical support. On the upside $7000 is a key resistance level, however I don't see it testing it without a downward move first. Hope you all have a nice weekend.
While markets are capable of movements that defy technical analysis, decisions and plans derived from it will reduce risk and increase profitability over the long term.
Here is my summary of the last 7 days based on the daily candles:
- There were 4 doji, 3 of the gravestone. The formation and wick/body ratio are similar to those found on shooting stars. While shooting stars are spotted at a peak signaling a reversal downwards, the Tether panic buying rally has skewed the level at which the candles trade at. When compensating for the breakout, these shooting stars would be trading near the peak of the latest move and at the top of symmetrical triangle.
- Volume has been ~50% below the 30 day moving average. There are 2 main reasons for this: 1. A lot of money on the sidelines was expended on Oct. 15th and hasn't been liquidated until the market moves decisively. 2. Many believe the price is too high and is going to drop. This market could break either way with higher volume and there's plenty of pros on Trading View who will give you both sides of it then claim they were right when the market moves within their set range. While that's good information to have, it's presented as a coin flip and doesn't provide strong analysis to setup trades with strong risk/reward ratios.
- On that note I'll provide some insight that to better access the market and I've yet to see this anywhere else. I wanted to know how the volume was split between buying and selling since Oct. 15th. At the $6900-$6714 level, 111,354 Bitcoins were traded over 2-3 days. Buying volume accounted for 49.88% vs. 50.12% for selling. Pretty even. At the $6713-$6500 level a total of 131,836 Bitcoins were traded over 8-9 days. Buying volume was 44.13% vs. 55.87% of selling volume. Over the last 7 days the most of the trading occurred in a corridor of 1.36%.
I've heard plenty of people talk about how this is a consolidation before an upward move. Based on this data, I'd argue it's a consolidation before a downward move. Combined with my technical analysis, I'm further convinced that the next major move will be down. $6000 to $6300 would be an acceptable drop if the support holds. Beneath that, $5750 is a critical support. On the upside $7000 is a key resistance level, however I don't see it testing it without a downward move first. Hope you all have a nice weekend.
Comment:
Western markets opened Monday morning dropping 1.5% in 20 minutes with an hour left before the 4 hour candle closes. Currently, it's holding at $6410 which is right on the upper trend line that is now acting as a support. Volume is beginning to slow down so I see a quick move upwards when the next 4 hour candle begins in a few minutes and where it'll have a consolidation period for a few hours before it heads down to test $6300.
Comment:
BTC didn't wait to consolidate and went to test $6300 after the 4 hour closed. BTC has temporarily reversed at $6315 but a retest is coming soon.
Comment:
About 2 hours left on the 4 and 8 hour candles. Now that BTC has dropped decisively below the upper trend line at $6400-$6410, it will act as a resistance. If BTC closes near the upper trend line, there's a possibility it'll cross above it before retesting $6300 (peaking no higher than $6520, more likely to peak around $6450). The alternative is that it'll drop without crossing over so either way a retest of $6300 is coming.
Comment:
Price rose to the upper trend line at $6397. It reversed and is currently heading down to retest $6300. Given the technical data, this move downwards is an ideal setup to buy panic sells who believe BTC is headed to $5750 or below. Structurally $6000-$6300 is looking strong. Any dips below would be short lived and the reversal should offer plenty of opportunities to exit with solid profit if BTC is truly headed below $5750 in the coming months.
Comment:
A few minutes ago, someone just dumped over $200k (USD, not XRP) of Ripple on Binance. The slippage on that was almost 0.9%. 5.5 hours ago another person dumped $160k (USD) of ICX eating almost 2% of slippage to get out of it. Traders with that type of capital tend not to dump like that and subject themselves to that much slippage without properly accessing the market and where it's anticipated to drop for reentry. It's not gospel but it's yet another indicator that a drop is coming.
Comment:
300 BTC sold in the last 8 minutes and formed a lower low. Alts responded slightly and when they catch on, it should drop swiftly into the support zone.
Comment:
Call it a hunch but if volume keeps this pace or increases, BTC will bottom out within the next 2.5 hours.
Comment:
Beware this last push with 20 minutes to go on the 4 and 8 hour candles. It'll form a nice doji or hammer, signaling a reversal and the pawns will rush in to buy now, fearing that they'll miss the upswing. This is likely to come back down to shake out the weak hands and like I said in my last update, I have a hunch that we'll find bottom in the next few hours if volume keeps up.
Comment:
4 and 8 hour candles closed strong however I got a strong "fear of missing out" vibe and the market is likely to come back down. The problem with FOMO movement is that they're no gunpowder left so it's easy to trap the FOMO buyers and leave them hanging at a peak. There is significant overhead resistance at $6500 and I doubt the daily will close above it in 8 hours. Combine that with the fact that Western markets might look at this move and push it right back down so I'm no where close to jumping aboard the bull train. The good news is that the pawns went first and formed a higher low so it's time to see if the upper trend line that BTC crossed over at $6355 will hold as a support.
Comment:
Price action is stabilizing around $6370 which suggests a move upwards is more likely than another retest of $6300. Support will be found at $6335 and $6287 (unlikely). Resistance will be light at $6420, heavy between $6475-$6500 and will likely reverse before hitting $6450. Entries and exits should be made based on risk tolerance.
Comment:
BTC rose as high as $6460 before it reversed. I expect it's going to bounce around a symmetrical triangle with an upper limit of $6455 and a lower limit of $6290, though most of the price action will likely occur between $6345-6450 over the next 24-36 hours. I estimate a retest of $6300 in 48-96 hours unless BTC breaks above $6500 decisively. In that scenario, a strong initial formation of an inverse head and shoulders would likely move upwards to test $7000 before $6300.
Comment:
Over the weekend BTC traded between $6448 and $6345. Yesterday BTC broke above one upper trend line and was rejected at another. On average volume appears to be picking up slightly. The 4 and 8 hour candles closing in a few minutes are forming a shooting star / evening doji pattern. If the short/mid term bottom on Oct 31st is valid, I'd anticipate a retest of $6360-$6390 in the next 3 days to show bullish support. With or without a retest, the next stop above $6500 is $6585-$6630.
Comment:
I'd like to amend the opening statement on the last update: "Over *most* of the weekend." When BTC broke above the upper trend line support, it was rejected at $6525 which is a key level of resistance as noted in many updates. Because there has yet to be a definitive close above it, it makes the retest of the bottom trend line more likely.
Comment:
BTC bounced off a minor upper trend line acting as support at $6432, climbing to $6615 before reversing (sidenote: the lack of retest of the bottom trend line = likely to be valid in the near future). Since it has definitively broken above $6500 and the 4 hour is about to close, expect it to spike lower and kiss the prior upper trend line that is now acting as support around $6475-$6485. From there it'll attempt a retest of $6600 where it'll meet first resistance around $6650.
Comment:
Apologies, meant to say first resistance at $6550 which is right now. If it drops after the retest to the $6460 level, a head and shoulders formation is in play which would coincide with the retest of the bottom trend line ~$6400.
Comment:
There's the kiss at $6481 after stalling at $6550.
Comment:
Well that kiss was short lived. The bulls continue to show weakness and the bears easily pushed BTC back under the trend line, accelerating the head and shoulder formation. Since then trading bounced off a 30 day bottom trend line and has shown a decent amount of effort to reverse upwards. However, the head and shoulders formed on a 30 day trend line which isn't a strong indicator and the retest that I keep talking about should occur in the $6320-$6350 range over the next 7 days. With a morning doji formed by two 4 hour candles I believe a move to the upper trend line ~$6460 is likely to happen before the 30 day trend line is broken and a retest occurs on the 140 day bottom trend line.
Comment:
BTC broke below the 30 day trend line and dipped to $6355 during the last 4 and 8 hour candles and reversed nicely. It came back down to retest in the following candles and reversed at $6363. This could very well be the retest of the 140 day bottom trend line though it's possible if it doesn't overcome the resistance ~$6440, it might come back down to retest the zone in my last update.
Comment:
The recent 4 and 8 hour candles formed a shooting star formation which is a bearish sign, however BTC has overcome the upper trend line at $6440 which is now acting as support. When looking at the daily, those shooting stars are negated due to the reversal coming off a major retest ($6355). If the daily candle closes anywhere from current levels to $6400, it's still a continuation of the reversal and more upward movement is to follow.