Bitcoin: Longer term bear channel could go back to $3000's
Longer term fibonacci channel to show reasoning of my support levels in my last trade idea (short at $6500). You can see that price right now is in the upper sub-channel and has lots of room to fall to lower channels.
Normally holding price over the 0.382 line (bottom green line) could indicate that price will move to top of sub-channel (top green line). However, without much buy volume currently, I have more confidence that we will fall down to the next 1 or 2 sub-channels.
I'm keeping my eye on the On Balance Volume (OBV). Although price is not at the top of channel, you can see that current OBV is at a similar level (red trendline in OBV) when prices were at the top of channel. This indicates to me that we are near a top in buying volume and will see more selling pressure in the coming days. If volume can break above red trend line, we may see a push up towards $7000 again. If $7000 is broken I think we would be free to fly to top of channel around $10,000.
My guess, though, is that the OBV will continue to decrease and drive us into those lower channels.
Yellow support line combined with 0.618 channel line (orange) creates a support zone of $4400 - $3800. Break from under there is bottom of channel which could see Bitcoin as low as $2500. Maybe some extreme fear selling over the next couple weeks can get us there (*cough* COVID-19 *cough*). Depends on when people realize that governments across the globe printing money may cause some issues with fiat.
I think it'll be more likely we bounce from $4000.
Happy to answer any questions or discuss ideas in relation to this!
-Coinformative
Normally holding price over the 0.382 line (bottom green line) could indicate that price will move to top of sub-channel (top green line). However, without much buy volume currently, I have more confidence that we will fall down to the next 1 or 2 sub-channels.
I'm keeping my eye on the On Balance Volume (OBV). Although price is not at the top of channel, you can see that current OBV is at a similar level (red trendline in OBV) when prices were at the top of channel. This indicates to me that we are near a top in buying volume and will see more selling pressure in the coming days. If volume can break above red trend line, we may see a push up towards $7000 again. If $7000 is broken I think we would be free to fly to top of channel around $10,000.
My guess, though, is that the OBV will continue to decrease and drive us into those lower channels.
Yellow support line combined with 0.618 channel line (orange) creates a support zone of $4400 - $3800. Break from under there is bottom of channel which could see Bitcoin as low as $2500. Maybe some extreme fear selling over the next couple weeks can get us there (*cough* COVID-19 *cough*). Depends on when people realize that governments across the globe printing money may cause some issues with fiat.
I think it'll be more likely we bounce from $4000.
Happy to answer any questions or discuss ideas in relation to this!
-Coinformative
Comment:
Despite the big increase in volume in the past couple days, we are still under the trend line I highlighted in the daily OBV. SO I'm still expecting to see buy volume decrease within the next couple day (rejected at the trendline). Below is just the 1D OBV chart. Break of resistance line would be bullish.
Comment:
Yup. Volume decreased quite a bit since I posted the update 2 days ago. Price followed from 6800-5900. Buy volume still has some room to drop.
Follow my 4H chart idea on Bitcoin for a more upclose look at OBV and where it may be heading.
Follow my 4H chart idea on Bitcoin for a more upclose look at OBV and where it may be heading.
