About time to do a review on this one...
BTCUSD has had a wonderful run since 2020 and a spectacular run following that come 2021. However, some warning bells are starting to ring.
Mathematically, there is such a thing as returning to mean... it is like when you and me hold one end each of a rubber band and start walking away from each other. The rubber band stretches. Thing is... when it gets too stretched, one of us will let go and the other still holding on. As the rubber band returns to its original state (returning to mean), the person still left holding on will feel the pain; albeit the one who let go might be laughing (just for instagram or tiktok cideo posting). Point here is... the BTCUSD rubber band is very stretched, and appears to continue to be stretch for the short term.
The weekly chart on the left shows how far from mean prices are now... it is more than double. Go calculate how far out the Standard Deviation is. Standard Bollinger bands put it about 1.5SD, with the mean about 40K. It was out of 2SD and came back in... honestly, not a good bullish sign, and the little grey dot above the candle two weeks ago indicate that qualification.
Thing is here... there just might be enough juice for a blow out to 70K in the shorter term, which also means to the immediate 2SD zone.
This bullish possibility is shown in the daily chart, especially of this week...
a series of higher lows off the 55EMA and higher highs still put BTCUSD in a bullish stance. MACD turned up and RPM is about to cross above the zero line. Breaking out of the trendline with incoming volume in the coming days would be bullish, else failure is fatal. Given the weekly close at the historical high, there is some legs left... but be very cautious!
BTCUSD has had a wonderful run since 2020 and a spectacular run following that come 2021. However, some warning bells are starting to ring.
Mathematically, there is such a thing as returning to mean... it is like when you and me hold one end each of a rubber band and start walking away from each other. The rubber band stretches. Thing is... when it gets too stretched, one of us will let go and the other still holding on. As the rubber band returns to its original state (returning to mean), the person still left holding on will feel the pain; albeit the one who let go might be laughing (just for instagram or tiktok cideo posting). Point here is... the BTCUSD rubber band is very stretched, and appears to continue to be stretch for the short term.
The weekly chart on the left shows how far from mean prices are now... it is more than double. Go calculate how far out the Standard Deviation is. Standard Bollinger bands put it about 1.5SD, with the mean about 40K. It was out of 2SD and came back in... honestly, not a good bullish sign, and the little grey dot above the candle two weeks ago indicate that qualification.
Thing is here... there just might be enough juice for a blow out to 70K in the shorter term, which also means to the immediate 2SD zone.
This bullish possibility is shown in the daily chart, especially of this week...
a series of higher lows off the 55EMA and higher highs still put BTCUSD in a bullish stance. MACD turned up and RPM is about to cross above the zero line. Breaking out of the trendline with incoming volume in the coming days would be bullish, else failure is fatal. Given the weekly close at the historical high, there is some legs left... but be very cautious!
