BITCOIN - Is a pull back/reversal imminent?I use a method of analysis using the Fibonacci re-tracement where I market out the lowest low to the next highest high (for an up trend), which then becomes the FIB range to work within (A - B) . In order for this FIB range (A - B) to be valid, we need to have the highs of two candles lower on either side of the highest high. Depending on where the market falls to within this (A - B) range determines the target on the next rally. More often than not the target is hit (D) to the "pip" at which stage a new FIB range is established. On a rally(up or down), it has been typically observed for 7 - 11 candles, and as we get to within this range of 7 - 11 candles, we need to be cautious of a short term reversal or pull back.
Looking at the current weekly of the BITUSD, Bitcoin last week smashed through this FIB target 2090USD (D), to set an all time high at 2757USD and the rally lasted for 9 weeks which is 9 candles - so following this pattern movement of 7 - 11 candles, we perhaps have another 2 weeks of rallying or more than likely sideways movement as it begins the turn around. Assuming the current Highest High at 2757USD is our new High for the FIB range ( A - B)( remember we are waiting for 2 candles on either side with lower highs to form as confirmation), I am expecting a fall back to the last level of support (C) on the weekly chart, which is 1271 - 1355USD before the climb again on the next wave up to the 3000 mark (3264 - 3915USD) (D) .
Many called last weeks pull back a CRASH, however I think it was just pull back! to let the market know that its ready to for a reversal.
Based on my analysis, I think the next few weeks we will see the pull back continue to happen as BITCOIN sorts out its fundamental issues over the next few months. As it does, I believe we will see a flow of BITCOIN into the ALT (Alternative) CrptoCoins over the next several weeks.
What are your thoughts??
