Bitcoin Prints Failure After Failure. More Downside Likely.
Bitcoin remains trapped inside of a downtrend channel (in black) which it has been forming since the 2019 high near 13,800. Despite several attempts to rally higher, BTC has formed nothing but lower highs and lower lows, proving that it is in a strong downtrend right now. During the past few days, we have seen BTC fall below the 50 day MA (in orange) and repeatedly fail to recover above it. The failure to hold above the 50 MA, the failure at the 21 week MA, the downtrend channel and the recent death cross are all strong confirmations that the bears are in control at the moment.
Assuming that BTC will not suddenly rally over the 50 MA, to attempt a surprise breakout right here, I think there is a relatively high probability that BTC will fall to the 50 week MA (in purple) at a bare minimum. The 50 week is actually a very important historical moving average, and BTC has shown that it likes to test it after breaking out above or below it.
In 2018, BTC tested it for support (first blue circle from left,) then rallied and fell back down to it. However, that time it failed to hold support and instead fell below the 50 week MA, defining it as resistance (second blue circle from left.) From there, price fell lower, the rallied all the way back up to the 50 week MA again, which acted as very strong resistance (third blue circle from left.) So, that was a test, a breakdown, and then a retest. From there, the bear market resumed and a catastrophic breakdown followed.
What we are witnessing right now may be the exact opposite. You can see that we had a breakout above the 50 week MA (fourth blue circle) and now BTC appears to be moving in for a retest, to see if that level will hold support. At this point, the market does look very weak. I've said on numerous occasions how uncharacteristic it is that BTC has faield to hold these key levels. This has never happened in the midst of a new bull market. So, there is a good chance that we are not currently in a bull market. However, there is hope for the bulls — and that's the 50 week MA. If BTC can hold that level as strong support, it would explain this year's price action quite well. On the other hand, BTC could break down below there in an attempt to reach the 3000 level again, which I have been stating as a risk since May. I'm sure many of you remember the analyses where I showed the regression arch, and that BTC had not yet tested it on my chart. A lot of people didn't like that call, but BTC has done nothing but fall since it reached my exact high target of 13,800. So, don't underestimate the volatility here. BTC could easily fall to 3000. I'm not saying that it will. For now, BTC has a chance at holding the 50 week MA (in purple) but that doesn't mean that it will. We'll just have to see what happens when BTC tests it, which should be around the low 7000 range.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-
Assuming that BTC will not suddenly rally over the 50 MA, to attempt a surprise breakout right here, I think there is a relatively high probability that BTC will fall to the 50 week MA (in purple) at a bare minimum. The 50 week is actually a very important historical moving average, and BTC has shown that it likes to test it after breaking out above or below it.
In 2018, BTC tested it for support (first blue circle from left,) then rallied and fell back down to it. However, that time it failed to hold support and instead fell below the 50 week MA, defining it as resistance (second blue circle from left.) From there, price fell lower, the rallied all the way back up to the 50 week MA again, which acted as very strong resistance (third blue circle from left.) So, that was a test, a breakdown, and then a retest. From there, the bear market resumed and a catastrophic breakdown followed.
What we are witnessing right now may be the exact opposite. You can see that we had a breakout above the 50 week MA (fourth blue circle) and now BTC appears to be moving in for a retest, to see if that level will hold support. At this point, the market does look very weak. I've said on numerous occasions how uncharacteristic it is that BTC has faield to hold these key levels. This has never happened in the midst of a new bull market. So, there is a good chance that we are not currently in a bull market. However, there is hope for the bulls — and that's the 50 week MA. If BTC can hold that level as strong support, it would explain this year's price action quite well. On the other hand, BTC could break down below there in an attempt to reach the 3000 level again, which I have been stating as a risk since May. I'm sure many of you remember the analyses where I showed the regression arch, and that BTC had not yet tested it on my chart. A lot of people didn't like that call, but BTC has done nothing but fall since it reached my exact high target of 13,800. So, don't underestimate the volatility here. BTC could easily fall to 3000. I'm not saying that it will. For now, BTC has a chance at holding the 50 week MA (in purple) but that doesn't mean that it will. We'll just have to see what happens when BTC tests it, which should be around the low 7000 range.
I'm The Master of The Charts, The Professor, The Legend, The King, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-JD-