Bitcoin Bulls Pushing Back, But Still a Big Road of Resistance
Because the bears were loosing momentum as well, because each drop was loosing selling and the drops were getting smaller. So we started to see a form which we already broke out of and still has a target around 3270. Short term momentum is on the side of the bulls now, but as soon for now they need to hold the 3210 at least.
Alts have made small breakouts as well and a few like BSV' and LTC' (check my LTC analysis) made very big jumps already. For alts and for Bitcoin' these are all still just first waves up. Without a second bigger wave, the bears will still have the upper hand. For Bitcoin' i think we need to see a break of 3400 at least to think momentum might be shifting. A break of 3600 would be a good victory for the bulls.
From the bear side, everywhere we read we can see people waiting for the 3000 levels or even slightly below it and for the bulls it was to hold the 3300/3200. Many people were eager to buy some around the 3000 level. But what if there are not enough people who want to sell the these lows and the people waiting for the 3000/2900 start to think their entries wont get reached?
I don't think it's difficult to think there are many people who shorted the lows, especially at the break of 3300 or even at 3200. If your wondering why we usually see big spikes happen after the break of a (or ) is actually because what i mentioned above. Unless the bears can hold the 3300, i think there is a very big chance for a decent short squeeze. I can't say where this level will, my best guess is around 3300/3330 but it could be higher as well. That where many people (including many of my members ) kept asking about with a target around 3000/2950, have their neckline/entry point around 3300/3350. So these traders might turn into buyers if they seen they want to close their shorts as well to prevent losses.
This is why is always so important, because the shows us that we do not only have shorts closing or bulls buying, but they show us both. Only then can one start to think a low (short/mid-term) could be set. So if you were wondering why i said earlier that we need a second wave up after this one, that is bigger than the first one, is because of this.
So for now we can say, a break of 3300ish could be in favor of the bulls and a break of 3400 might be a turn around. Anything below 3300 could still just be another failed attempt for the bulls and we could see a countermove from the bears again. The 3100ish level is a clear support now, but i don't think that if we see a decent drop again from these levels, that it will hold. I think prices below the 3K, around 2800/2900 will probably be in play then.
My members know i have been saying that i think it's time again for a big bear shake out, because the sentiment has become very the past week. With this i don't mean a correction to 3600/3800, but a much bigger upwards correction. I personally thought the 3200/3250 would hold a few days ago but after that Bart move failed, things became more dangerous. After that turned out to be a triangle, so reaching the 3140 instead of the 3050, it was a small signs for a potential low. On the left we can see that channel i have been showing the past days, and as i mentioned in the previous analysis, we broke it, kept bumping against the former support and moved back in again (yellow circles). We did the exact same the second time. But this time the move up is bigger than the first attempt. Usually after traps like this we see countermoves, but the first attempt clearly failed with the rally to 3300, so it really looked as if the bears were still in full control. That's why i think the 3300ish level could already be quite significant.
OI on Bitmex has increased a lot the past 24H, almost 35 mil and around a level of 345 mil. The last time we had this level we made that drop from the 3400/3450, this time we can expect a decent move again (squeeze), but if the bulls can hold ground and break through the 3300, i think that squeeze will be a short squeeze.
So in short, i am expecting a big upwards correction around these levels soon, it could be from here on out if this attempt succeeds. For me the 3210 is already important and 3180 will make me very careful again. It's very tight, but that simply because the trend is still . It is actually also funny to see, how they start a move up on Saturday night CET time. Is it a coincidence or is it intentional, to do it at exactly that time of the day and week, where most people are not trading. We have seen it happen before with big moves, but usually drops though.
Please don't forget to like if you appreciate this :)
Each time we see a squeeze up and a move down just as fast, that shows the Bitmex bears are still in play and shorting the market with high volume. The fact it happens so fast is because they have bots doing this. What they usually do, is trigger a small squeeze up, have their shorts ready to get filled and just as fast eat up all the buys on the way down again. So filling up a big bag in a matter of minutes. The previous time it almost looked like they would fail, but they kept it below the 3500 and eventually the market turned down again. If the bulls give away the 3230/20, it will become pretty shaky already.
It could also turn into a triangle here, there is decent chance for that since the bulls kept that pattern of higher lows above previous high intact.
So volume is still missing, but there are still chances.
But before bulls get too excited, bears have been very strong so far. They have already made a double top at the 3260 which will get confirmed if the 3210/200 breaks.
At least we know we are most likely going to see a big move again soon instead of the sideways action we have seen the past week.
So for now we can say that we have a clear level around 3260 and for the bears probably around 3160 and otherwise the previous low at 3120.
Otherwise forget it, because they have failed many times lately.
Alts are still holding, so neutral on that side. As soon as we see them dumping again, than it will probably be confirmed that the bears have taken over again. I would look at the most bullish alts from yesterday, when you see their supports break, it might give you a very good indication about the next step
Bitcoin has also just made a lower high and just broke the 3200/190 support which was an support zone until now. OI on Mex has dropped a bit as well.
So nothing big yet, but momentum has clearly shifted from slightly bullish to neutral. But inside the bear trend it's better to say that momentum is on the side of the bears again.
The 3160ish, level i mentioned earlier, could still work as a last support. Creating a higher lower there.
I still think we are seeing accumulation around these levels. OI keeps on rising on Bitmex at stable prices. For the first time the past 5 weeks
Brought myself up to date through your posts, David. Thanks for keeping the updates coming so frequently buddy. Must say that the price action has been interesting. We'll see where this goes.
All the best,
Great advice, James. Thanks.