Yes the downtrend can still continue, however i'm seeing the potential for a bounce to occur.
Some things to consider:
Weekly:
1. We haven't broken below major weekly support level yet (our Major Higher Low uptrend structure).
2. Our previous weekly candle close is a bullish inside bar/indecision bar.
3. Our current weekly candle hasn't closed yet, which can easily flip or become a weak bearish candle.
Taking points 2 and 3 together can signify (point 2 alone CAN can spell a potential reversal to come), a slow down of momentum on the weekly time frame.
Daily:
A channel-like, wedge-like price action, signifying a potential slow-down on the daily time frame, resulting in a higher probability of a bullish breakout and a failure to continue lower. Another "indicator" of a slow-down in the downside momentum.
Even though it does have a bearish distribution behaviour of Lower Highs and lower lows, inspect the size of the impulses down and the retracements up, especially compared to a stronger bearish tight channel-like behaviour, which it is not.
4 hour:
1. Can see a rejection from the bottom of the range, which a reversal signal and another follow-through bull bar (granted it is weak, however it is still a follow-through bar).
YES, we can get a failure, rejection of broken support, tested as resistance and then fall. This is definitely a possibility, following the downtrending structure of lower highs and lower lows. However we can also see this as a bottom of the range with rejection to the upside, forming a double bottom.
If we get continuation and more follow-through here, with price breaking back WITHIN the range, that's increasing our probabilities of a bullish bounce.
This is an early bounce entry.
The next, more solidified bullish case strengthens with a close and follow-through ABOVE The previous Lower High above the 49 - 49.8k level.
From then we can look at the next steps, however our bullish case will look much stronger at that point, in which we can look to tackle the more major LOW level of approx 51 - 52k.
1 hour:
1. 1 hour is showing the break outside of the bearish channel, which failed to break above the previous LH, came back down to test the low, forming a potential double bottom reversal after breaking the bear channel.
We require the 1 hour to break and close above the previous Lower Highs for our higher time frames to get even stronger.
15min:
Formation of a bullish channel after breaking above it's local prev highs, followed by a pullback. A break above it's own high and continuation to break above previous lower highs will confirm uptrend continuation on the lower time frame, which in turn should help strengthen higher time frame cases.
Some things to consider:
Weekly:
1. We haven't broken below major weekly support level yet (our Major Higher Low uptrend structure).
2. Our previous weekly candle close is a bullish inside bar/indecision bar.
3. Our current weekly candle hasn't closed yet, which can easily flip or become a weak bearish candle.
Taking points 2 and 3 together can signify (point 2 alone CAN can spell a potential reversal to come), a slow down of momentum on the weekly time frame.
Daily:
A channel-like, wedge-like price action, signifying a potential slow-down on the daily time frame, resulting in a higher probability of a bullish breakout and a failure to continue lower. Another "indicator" of a slow-down in the downside momentum.
Even though it does have a bearish distribution behaviour of Lower Highs and lower lows, inspect the size of the impulses down and the retracements up, especially compared to a stronger bearish tight channel-like behaviour, which it is not.
4 hour:
1. Can see a rejection from the bottom of the range, which a reversal signal and another follow-through bull bar (granted it is weak, however it is still a follow-through bar).
YES, we can get a failure, rejection of broken support, tested as resistance and then fall. This is definitely a possibility, following the downtrending structure of lower highs and lower lows. However we can also see this as a bottom of the range with rejection to the upside, forming a double bottom.
If we get continuation and more follow-through here, with price breaking back WITHIN the range, that's increasing our probabilities of a bullish bounce.
This is an early bounce entry.
The next, more solidified bullish case strengthens with a close and follow-through ABOVE The previous Lower High above the 49 - 49.8k level.
From then we can look at the next steps, however our bullish case will look much stronger at that point, in which we can look to tackle the more major LOW level of approx 51 - 52k.
1 hour:
1. 1 hour is showing the break outside of the bearish channel, which failed to break above the previous LH, came back down to test the low, forming a potential double bottom reversal after breaking the bear channel.
We require the 1 hour to break and close above the previous Lower Highs for our higher time frames to get even stronger.
15min:
Formation of a bullish channel after breaking above it's local prev highs, followed by a pullback. A break above it's own high and continuation to break above previous lower highs will confirm uptrend continuation on the lower time frame, which in turn should help strengthen higher time frame cases.
Comment:
If we do get the bounce and strength with the follow-through, with breaks above previous lower highs, i see price moving at least to the 50% retracement level of the more recent swing down. We'll see what occurs at that level, as we need to breakout above even more KEY Lower Highs for our trend to turn even more bullish.
However from the point of this POTENTIAL bounce down low, to the movement to at least approximately the 50% level, i'm expecting the alt coin market to follow suit
At this point in bitcoin, if this occurs we have a more equilibrium point,where we have had a big DOWN movement, followed by a bounce up. We will be in a situation where there's a good case for bulls (weekly uptrend structure in tact) and good case for bears (as bears have a discounted 50% retracement level price to short for at least a 2nd leg down to test the bottom of this big downward move they just established. This coincides with the monthly ending too, so we may some interesting battles near the 50% level (this 50% retracement level also coincides with various key structures of the market).
Since there will be a good case for bulls and bears, we may see this equilibrium point, aka a trading range, where bulls and bears battle it out and then determine the next direction via a breakout of that range.
However from the point of this POTENTIAL bounce down low, to the movement to at least approximately the 50% level, i'm expecting the alt coin market to follow suit
At this point in bitcoin, if this occurs we have a more equilibrium point,where we have had a big DOWN movement, followed by a bounce up. We will be in a situation where there's a good case for bulls (weekly uptrend structure in tact) and good case for bears (as bears have a discounted 50% retracement level price to short for at least a 2nd leg down to test the bottom of this big downward move they just established. This coincides with the monthly ending too, so we may some interesting battles near the 50% level (this 50% retracement level also coincides with various key structures of the market).
Since there will be a good case for bulls and bears, we may see this equilibrium point, aka a trading range, where bulls and bears battle it out and then determine the next direction via a breakout of that range.
Comment:
If we bounce and retrace to the ~50% level, we may eventually come back down for a 2nd test down. Why?
1. The move down was large, and there's now more bearish action, with bears still relatively strong larger range/higher price levels. They were here before back in May/June, and we are still within this larger range on the weekly. They are still here, as evident in the recent move down, and hence they may enter again for a 2nd leg down after a pullback and failure for bulls to break above Major key levels 54k and/or 58-59k.
2. This 2nd test down also forms a confirmation double bottom (confirmation low) of our Daily Bullish Shark Pattern.
1. The move down was large, and there's now more bearish action, with bears still relatively strong larger range/higher price levels. They were here before back in May/June, and we are still within this larger range on the weekly. They are still here, as evident in the recent move down, and hence they may enter again for a 2nd leg down after a pullback and failure for bulls to break above Major key levels 54k and/or 58-59k.
2. This 2nd test down also forms a confirmation double bottom (confirmation low) of our Daily Bullish Shark Pattern.
We are currently setting up the monthly candle close which is currently a very crucial candle in determining the long term direction of this asset.