Crypto enthusiasts glued to the news and prices observed a small correction in Bitcoin last evening and this morning. Unfortunately, it is doubtful that this is extent of the dip, it was merely completing the apex of the flag pattern we've been discussing since last week. Indeed, the technicals seem to augur a more emphatic breakdown.
We have a bear flag pattern that has been forming for the past several months. Unfortunately, this most recent correction does not seem to be anything more than a test of the lower bound of the flag. There is a large vacuum zone below, amplified by the excess liquidity at the consolidation point in the flag. Volatility has nearly dried up completely, and has broken a lower bound, as measured by the ATR. The volatility itself is forming a consolidation pattern, and is due for a major correction back to higher territories.
It is highly likely BTC will test lower levels at $6100 or $5800. Either way, as we've cited many times before $5800 seems to be the lowest price for BTC that the markets will accept for now. Thus, it is highly likely that we will see it get bought back at these levels even if they fail to hold at some point. If this is the case, one may expect some meager support at $5500 and $5000 which are Fibonacci levels and also correspond to psychological levels. If those fail, we must appeal to the $4K or even $3K handles for support.
If we're right and we see a rally off nearby levels of support, or even a breakout, we'll see resistance at $6900 from a Fibonacci level, then from $7400 from technical level formed by the lows of day candles going back a bit. We have a few more technical and psychological levels before we can breach the $8000 handle, but it's doubtful we'll test that before 2019.
Thanks for checking out my post! Please feel free to leave any questions in the comments, and check out my other social media and profile!
We have a bear flag pattern that has been forming for the past several months. Unfortunately, this most recent correction does not seem to be anything more than a test of the lower bound of the flag. There is a large vacuum zone below, amplified by the excess liquidity at the consolidation point in the flag. Volatility has nearly dried up completely, and has broken a lower bound, as measured by the ATR. The volatility itself is forming a consolidation pattern, and is due for a major correction back to higher territories.
It is highly likely BTC will test lower levels at $6100 or $5800. Either way, as we've cited many times before $5800 seems to be the lowest price for BTC that the markets will accept for now. Thus, it is highly likely that we will see it get bought back at these levels even if they fail to hold at some point. If this is the case, one may expect some meager support at $5500 and $5000 which are Fibonacci levels and also correspond to psychological levels. If those fail, we must appeal to the $4K or even $3K handles for support.
If we're right and we see a rally off nearby levels of support, or even a breakout, we'll see resistance at $6900 from a Fibonacci level, then from $7400 from technical level formed by the lows of day candles going back a bit. We have a few more technical and psychological levels before we can breach the $8000 handle, but it's doubtful we'll test that before 2019.
Thanks for checking out my post! Please feel free to leave any questions in the comments, and check out my other social media and profile!