Short term price action looks good
Price of the bitcoin has dropped for more than 6% since the latest test toward the horizontal resistance zone 2 days ago. This drop pattern however could be the effect of the rejection that we saw on October 31st. However, the price is still trending right above the support trend line that has been formed since October 21st and can be considered as the significant support trend line especially for intraday basis.
At the latest drop, we see a huge drop and the price touched this white support trend line but on the 2 hours we have seen a huge bounce since the price touched it with a long wick toward this support trend line. Another factor that I'm seeing is the possibility of potential upside continuation if we measure it from the perspective of momentum occurring in the market. On the price we see a lower high structure consecutively since October 25th while on the RSI we see a consecutive lower low structure since the same date. This action could be considered as the hidden bullish divergence as a possible continuation pattern.
However, to anticipate and to minimalize the risk of glitching that is occurring in the market, an entry after the confirmation of breaking out is needed. I see the blue resistance trend line as a perfect validation if you want to enter long position. Breaking out above this region will become another step forward for bitcoin because a huge probability that the price will use this momentum to breaks the $14000 resistance zone too.
The bad way is when the price breaks below this white support trend line and invalidate the hidden bullish divergence scenario which can lead the price to another drop toward the 2 blue zones as the crucial support in the future.
At the latest drop, we see a huge drop and the price touched this white support trend line but on the 2 hours we have seen a huge bounce since the price touched it with a long wick toward this support trend line. Another factor that I'm seeing is the possibility of potential upside continuation if we measure it from the perspective of momentum occurring in the market. On the price we see a lower high structure consecutively since October 25th while on the RSI we see a consecutive lower low structure since the same date. This action could be considered as the hidden bullish divergence as a possible continuation pattern.
However, to anticipate and to minimalize the risk of glitching that is occurring in the market, an entry after the confirmation of breaking out is needed. I see the blue resistance trend line as a perfect validation if you want to enter long position. Breaking out above this region will become another step forward for bitcoin because a huge probability that the price will use this momentum to breaks the $14000 resistance zone too.
The bad way is when the price breaks below this white support trend line and invalidate the hidden bullish divergence scenario which can lead the price to another drop toward the 2 blue zones as the crucial support in the future.
