Bitcoin / US Dollar Perpetual Inverse Swap ContractBitMEX
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Bitcoin looks ready to test $3000 before a strong reversal and breakout from the prospective bear trap.
The exhaustion volatility from the nonfailure reversal on 24/12 (blue vertical) predicts a break of $3000, providing institutional investors access to a significant liquidity pool. Fibonacci retracement (dark blue) has an extended fib level (0.786) at $2959. This is close to the previous resistance/support level found at $2955. Short term Fibonacci time zone placement (vertical dashed) suggests that significant changes in trend may occur around 26/1 and 19/2. Long term Fib time zone placement (vertical solid) suggests a significant trend change around 10/2.
A high probability long position could be entered at the levels indicated in green, with a stop loss placed below 2900. The mid term targets from the predicted breakout average around 5400. This provides a potential R value of >14. I will post another chart as we approach the potential breakout zone.
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Exhaustion volatility can also be measured from close-open, providing the same measure.
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Hourly leading ichimoku resistance at key level ($3540) and downtrend resistance
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Price breakout of downtrend, currently meeting resistance of previous trading range. Trade remains valid until upper resistance of previous trading range is broken
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Hourly bearish TK cross within bearish kumo cloud. This is a bearish-neutral signal. Suggesting sideways movement with a potential upward stop loss hunt, but with a probable bearish outcome
6Hr Bollinger bands have just tightened to the smallest bottle neck since the breakdown of 6K, with bandwidth confined to the lower 50% of the previous range (white circle) This indicates very low volatility, which often precedes a high volatility move (As per Hunt Volatility Funnel) This is occurring as we are 1 day away from the next short term fib time zone (5), while sitting on the significant level of 3500.
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Price now at key level of significance (3565) as the day has closed on the short term fib time zone (5). We could now see a break from the uniquely constrained volatility
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BTC price in contact with resistance from previous symmetrical triangle (yellow dashed). 6Hr RSI resistance beneath 50
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Short term ascending wedge
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Rising wedge EW reversal
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Potential Nonfailure reversal
Trade closed: stop reached
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Short position closed but prediction remains valid. Long position at 3000 will be outlined if price approaches buy zone.
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MACD indicating a decision point soon
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Bear flag forming on key level of significance
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BTC hourly ADX highest it's been in 5 months, indicates the short term trend is very strong and might need to cool off with a bounce to around 3480 RSi break above 30 giving same signal
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Fib speedlines suggest trend will slow to within the green lines
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Short term H&S in conlfuence with other signals suggesting a bounce (Not confirmed until neckline break). Take profit opportunity in green with short reentry in red I'm holding a hedge short and taking some profits for later reentry
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BTC long position, hedge against longer term short. R:R = 8.1, Min winrate =15% including drawdown
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Adjusting the fib speedlines to fit the recent low projects price to hit 3000 at the 8th Fib time zone in early feb. This could be the bottom
Order cancelled
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After assessing the bigger picture, I don't believe BTC will reach 3000, but instead it appears likely to complete an inverted H&S formation