When we rejected at the 200 EMA on the daily, we didn't think much of it. We laughed at the death cross on the daily thinking it would work as a bullish signal, it did not. And now after China shutting down miners news and that big red candle close on a Monday, most people agree some further continuation to the downside is implied for the next few days.
I hear too many people saying we are going to 20k, which really makes me think we don't go to such an obvious level that some people are begging to buy back at because they have already sold near the bottom. However, there are 3 areas above 20k that I see as support and potential reversal levels.
The first area outlined in the green box is between our last major low at 29800 to 28800 coinciding with our January 21 2021 lows. I am also using the volume profile indicator on the right to find places for where there was a lot of trading happening and use those areas as support, although there isn't much at this level. it is also worth noting that this area would be a 30% down move from the last high we had at 41400.
the next one is between 27700 and 26800. this one coincides with the January 4th low and a couple of days of sideways moevement. The volume profile is a little bit larger there than at the 29 k area but not as convincing as a support level.
the third level and strongest of the supports is at the 24500-22900 area. the volume profile is pretty full there and there was a period of consolidation where we lingered for a week before Christmas. Also it lines up with a 40% move from the last high, and we know how bitcoin loves to dump 30-40% a few times a year.
now anything below that, it would surely go straight to the 20k support level. But like i said, too many people are expecting it and the masses are usually wrong.
This market is meant to be tricky and wash people out. And what a better way to do it than by making a new low, triggering a bunch of stop losses and liquidations, and trapping a bunch of bears thinking we are going straight to 20k.
i do expect the turn around to be quick, and any big daily green candle and a cross back to the upside on the 12 hour stochastics would be a confirmation for a bottom and a huge bounce.
I hear too many people saying we are going to 20k, which really makes me think we don't go to such an obvious level that some people are begging to buy back at because they have already sold near the bottom. However, there are 3 areas above 20k that I see as support and potential reversal levels.
The first area outlined in the green box is between our last major low at 29800 to 28800 coinciding with our January 21 2021 lows. I am also using the volume profile indicator on the right to find places for where there was a lot of trading happening and use those areas as support, although there isn't much at this level. it is also worth noting that this area would be a 30% down move from the last high we had at 41400.
the next one is between 27700 and 26800. this one coincides with the January 4th low and a couple of days of sideways moevement. The volume profile is a little bit larger there than at the 29 k area but not as convincing as a support level.
the third level and strongest of the supports is at the 24500-22900 area. the volume profile is pretty full there and there was a period of consolidation where we lingered for a week before Christmas. Also it lines up with a 40% move from the last high, and we know how bitcoin loves to dump 30-40% a few times a year.
now anything below that, it would surely go straight to the 20k support level. But like i said, too many people are expecting it and the masses are usually wrong.
This market is meant to be tricky and wash people out. And what a better way to do it than by making a new low, triggering a bunch of stop losses and liquidations, and trapping a bunch of bears thinking we are going straight to 20k.
i do expect the turn around to be quick, and any big daily green candle and a cross back to the upside on the 12 hour stochastics would be a confirmation for a bottom and a huge bounce.