Happy Saturday. The scope of the TA will be limited to the 15M Intraday Chart and the 1D Chart.
With that, let’s get to the TA…
Looking at the 15M Intraday Chart, the formation has completed Phase A of a Wyckoff Accumulation range, establishing the Intraday trade range between $234.25 and $230.00. The formation has moved into Phase B of a Wyckoff Accumulation, has completed the Upward Thrust (UT) to the $234.50 price handle, followed by a second Upward Thrust (UT) on a Sign of Strength (SOS) to the $235.50 price handle. The formation is currently forming a creek before moving into Phase C.
The formation has printed a second Upward Thrust (UT) on a Sign of Strength (SOS) and the PA appears to have formed a classic Back-Up/Last Point of Supply (BU/LPS) at the $234.25 price handle suggesting imminent breakout. At first glance, it appears the formation is about to have a strong move higher, but it smells more of a bull trap for a couple of reasons:
The PA remains confined below trend line resistance, suggesting the chart be viewed with a bearish bias.
The formation is currently in Phase B of a Wyckoff Accumulation, and an Upward Thrust (UT) of this type is typical PA before forming a Creek to move into Phase C. A breakout during this phase is atypical. The key item to watch for is PA retuning into the trade range (failure and supply).
The Volume profile is materially weak given the strong move higher on a Sign of Strength (SOS) and the Volume Oscillator is printing a sharp decline on the move, indicating the trend is weakening and on the verge of change.
Everything here is mirrored almost exactly on the 4H Intraday Chart as well.
On 1D chart, the formation signaled a move into Phase D of a Wyckoff Distribution and is currently printing the first Last Point of Supply (LPSY) on a macro level.
Two key items of note: (i) the upper line of support rests at the $229.50 price handle and the lower line of support rests at the $225.25 price handle, and (ii) the $229.50 price handle is a critical point across all three Charts (1D, 4H & 15M). Without a doubt this is the single most critical price point with the current PA. A breach below this price handle will signal a significant breakdown of support on the Intraday time frames and signal a sell on the higher time frame (1D).
A price of $230.00 would form a double bottom on the 1D Chart and touch lower support on both Intraday Charts (4H and 15M). A price of $229.75 would signal a sell from the double bottom on the higher time frame (1D) and breach the lower support line on the Intraday charts (4H & 15M). A price of $229.50 would confirm the double bottom sell and touch the upper line of support on the 1D Chart.
Summary/My Trade Plan
While the bias across the board remains bearish, a slight lean towards short position entry at points above $233.75 seems to make sense from a risk/reward scenario. Given both, (i) the premature Selling Climax (SC) Ethereum had as a reaction to Bitcoin breaking lower support at $9,120.00 and (ii) Bitcoin just completed a Return to ICE (RTICE) completing Phase D of a Wyckoff Distribution pattern, the natural move from a Creek to Spring in a Phase C Wyckoff Accumulation makes logical sense as a potential inflection point into a Selling Climax (SC) should Bitcoin move into Phase E Distribution in the near future.
Should the formation bounce on a typical Jump Across the Creek, the position can still be closed in minor profit. However, should the inflection point not hold, the ensuing Selling Climax (SC) provides an excellent opportunity for more material profit as support across multiple time frames should potentially fail in rapid succession. The $229.50 price handle is a critical point across all three Charts (1D, 4H & 15M). Without a doubt this is the single most critical price point with the current PA. A breach below this price handle will a signal significant breakdown of support on the Intraday time frames and signal a sell on the higher time frame (1D).
Always remember this is not trading advice.
Outside of that, Happy Trading.
With that, let’s get to the TA…
Looking at the 15M Intraday Chart, the formation has completed Phase A of a Wyckoff Accumulation range, establishing the Intraday trade range between $234.25 and $230.00. The formation has moved into Phase B of a Wyckoff Accumulation, has completed the Upward Thrust (UT) to the $234.50 price handle, followed by a second Upward Thrust (UT) on a Sign of Strength (SOS) to the $235.50 price handle. The formation is currently forming a creek before moving into Phase C.
The formation has printed a second Upward Thrust (UT) on a Sign of Strength (SOS) and the PA appears to have formed a classic Back-Up/Last Point of Supply (BU/LPS) at the $234.25 price handle suggesting imminent breakout. At first glance, it appears the formation is about to have a strong move higher, but it smells more of a bull trap for a couple of reasons:
The PA remains confined below trend line resistance, suggesting the chart be viewed with a bearish bias.
The formation is currently in Phase B of a Wyckoff Accumulation, and an Upward Thrust (UT) of this type is typical PA before forming a Creek to move into Phase C. A breakout during this phase is atypical. The key item to watch for is PA retuning into the trade range (failure and supply).
The Volume profile is materially weak given the strong move higher on a Sign of Strength (SOS) and the Volume Oscillator is printing a sharp decline on the move, indicating the trend is weakening and on the verge of change.
Everything here is mirrored almost exactly on the 4H Intraday Chart as well.
On 1D chart, the formation signaled a move into Phase D of a Wyckoff Distribution and is currently printing the first Last Point of Supply (LPSY) on a macro level.
Two key items of note: (i) the upper line of support rests at the $229.50 price handle and the lower line of support rests at the $225.25 price handle, and (ii) the $229.50 price handle is a critical point across all three Charts (1D, 4H & 15M). Without a doubt this is the single most critical price point with the current PA. A breach below this price handle will signal a significant breakdown of support on the Intraday time frames and signal a sell on the higher time frame (1D).
A price of $230.00 would form a double bottom on the 1D Chart and touch lower support on both Intraday Charts (4H and 15M). A price of $229.75 would signal a sell from the double bottom on the higher time frame (1D) and breach the lower support line on the Intraday charts (4H & 15M). A price of $229.50 would confirm the double bottom sell and touch the upper line of support on the 1D Chart.
Summary/My Trade Plan
While the bias across the board remains bearish, a slight lean towards short position entry at points above $233.75 seems to make sense from a risk/reward scenario. Given both, (i) the premature Selling Climax (SC) Ethereum had as a reaction to Bitcoin breaking lower support at $9,120.00 and (ii) Bitcoin just completed a Return to ICE (RTICE) completing Phase D of a Wyckoff Distribution pattern, the natural move from a Creek to Spring in a Phase C Wyckoff Accumulation makes logical sense as a potential inflection point into a Selling Climax (SC) should Bitcoin move into Phase E Distribution in the near future.
Should the formation bounce on a typical Jump Across the Creek, the position can still be closed in minor profit. However, should the inflection point not hold, the ensuing Selling Climax (SC) provides an excellent opportunity for more material profit as support across multiple time frames should potentially fail in rapid succession. The $229.50 price handle is a critical point across all three Charts (1D, 4H & 15M). Without a doubt this is the single most critical price point with the current PA. A breach below this price handle will a signal significant breakdown of support on the Intraday time frames and signal a sell on the higher time frame (1D).
Always remember this is not trading advice.
Outside of that, Happy Trading.