As you can see from the chart, we are currently bouncing off the higher support line, into the resistance line established by the bear run started in late December / early January. This is no news, it's been happening for a while.
The convergence of the resistance and support line is imminent at the beginning of the second week of April, thus the price must choose a direction... Up, or Down.
The sentiment has been bearish for the past week or two as the 200D MA and the 50D MA were about to cross (Death cross talk) but now, looking at the trend of the two lines, it's no longer likely to happen. The price is currently at the support line, but instead of crossing the two MA's have become parallel, and unless the price decides to break support right now, the crossing of the two is extremely unlikely.
We can see that, as of writing, the price is lining up to re-test resistance but in doing so it will have completed an inverted H&S which is a strong bullish indicator and its completion is relatively close to the resistance line.
Without the 200D MA x 50 MA and with this H&S forming, bulls may get excited enough to actually close the price above resistance. Should they manage to do so, the current support line becomes pretty much seald and a new bullish trend is estabilished.
HOWEVER, if this next resistance test failes and the price starts falling again, it may not recover and go straight down to the next support line around 4K. Failure at this stage does not permit any further re-tests of resistance, there just isn't any more time before the wedge closes. Supplemented to that, going down again may cause the two MAs to cross which is also a bearish indicator.
In short, there is strong reason for the price to break the resistance at the next re-test. In the unlikely event that it fails to do so, queue titanic music.
The convergence of the resistance and support line is imminent at the beginning of the second week of April, thus the price must choose a direction... Up, or Down.
The sentiment has been bearish for the past week or two as the 200D MA and the 50D MA were about to cross (Death cross talk) but now, looking at the trend of the two lines, it's no longer likely to happen. The price is currently at the support line, but instead of crossing the two MA's have become parallel, and unless the price decides to break support right now, the crossing of the two is extremely unlikely.
We can see that, as of writing, the price is lining up to re-test resistance but in doing so it will have completed an inverted H&S which is a strong bullish indicator and its completion is relatively close to the resistance line.
Without the 200D MA x 50 MA and with this H&S forming, bulls may get excited enough to actually close the price above resistance. Should they manage to do so, the current support line becomes pretty much seald and a new bullish trend is estabilished.
HOWEVER, if this next resistance test failes and the price starts falling again, it may not recover and go straight down to the next support line around 4K. Failure at this stage does not permit any further re-tests of resistance, there just isn't any more time before the wedge closes. Supplemented to that, going down again may cause the two MAs to cross which is also a bearish indicator.
In short, there is strong reason for the price to break the resistance at the next re-test. In the unlikely event that it fails to do so, queue titanic music.
I guess this is it... See you at 4 K :)