Yesterday's rally was a nice expected pump as BTC dropped into the "reloading zone," aka the bottom of the descending channel that has been traded since it topped this year with a lower high from its all time high. (Echo bubble anyone?) It was expected to drop to around 7035 and bounce but it bounced slightly sooner and appears to have hit a temporary top. Moves on lower time frames for this recent rally have formed a head and shoulders pattern along with a bearish divergence on the RSI in the same area (again?) and has now broken the neckline. As I am writing it appears to be retesting the neckline. If it does rise above it BTC could move up to the 78xx zone. If it fails to rise above the neckline this H & S would put us right back down at the bottom of the channel in the 64xx area as an end move. Let's see how it plays out but please protect your capital.
BTC will need to rise above the top of the H & S at 7450 to negate this pattern. Rising above 7450 is also the trendline to watch mid tern bullish strength.
BTC will need to rise above the top of the H & S at 7450 to negate this pattern. Rising above 7450 is also the trendline to watch mid tern bullish strength.
Comment:
BTC failed to break the neckline on retest and has respected it ever since, remaining below the 7200 mark. Lots of sideways action has created mixed signals for BTC. However, BTC has obeyed this neckline as a legit pattern thus far. Is this a bull accumulation or a whale propping it up while selling? Given similar movement several times recently, I am slightly leaning towards the latter, but don't forget to stop your trades, should a frenzy upward ensue.
Comment:
7450 marks the midline of the downward channel, a very important level of resistance for BTC right now. We may see another run for it soon. If that should fail, expect a double top dump.