A significant level of support (20500) is again being tested... The biggest test the level has had so far.
Up to now every test of the 20500 level has seen a quick 'touch and go' reaction, where supply has very quickly hit demand (waiting buy orders) and price has bounced away with strong momentum.
This time looks very different and suggests that the demand in this area is wearing thin, with sellers having their best chance so far of breaking through this level... If a breakdown in demand does come through and we see a daily close below the current congestion, then expect a swift retest as resistance before dropping to the low of December around 19000.
If the level is able to hold and we start to see some strength in the OBV, pushing positively away from its 20ema then price will meet some heavy resistance at the top of this current triangle.
I expect this to all play out over the next few days and will be heavily influenced by any Trump Tweets and US-Sino trade talk headlines.
Up to now every test of the 20500 level has seen a quick 'touch and go' reaction, where supply has very quickly hit demand (waiting buy orders) and price has bounced away with strong momentum.
This time looks very different and suggests that the demand in this area is wearing thin, with sellers having their best chance so far of breaking through this level... If a breakdown in demand does come through and we see a daily close below the current congestion, then expect a swift retest as resistance before dropping to the low of December around 19000.
If the level is able to hold and we start to see some strength in the OBV, pushing positively away from its 20ema then price will meet some heavy resistance at the top of this current triangle.
I expect this to all play out over the next few days and will be heavily influenced by any Trump Tweets and US-Sino trade talk headlines.