BTC has caught a bounce over the last few days off the back of a general improvement in market sentiment (S&P, Nasdaq). BTC is still highly correlated to the equities market.
IMHO there is not a decent trade at this level where we find ourselves in the middle of a range ($43K, lower = $39K, upper = $48K). There is a huge amount of previous resistance at $48K level, as shown by the VPVR indicator. The BMSB (bull market support band) indicator is also found at these levels ($49K-51K).
If BTC does continue to push higher I don't think that market sentiment is bullish enough to take it through the upper band. Too many participants will view it as a chance to take profit as they wait out the uncertain mid-term financial climate. Current volume is also underwhelming, not suggesting a huge amount of confidence in the market.
I am looking for support above £48K (low probability) or back down at $39K (higher probability) to take potential long trades.
This is not financial advice. DYOR. Thoughts welcomed below.
IMHO there is not a decent trade at this level where we find ourselves in the middle of a range ($43K, lower = $39K, upper = $48K). There is a huge amount of previous resistance at $48K level, as shown by the VPVR indicator. The BMSB (bull market support band) indicator is also found at these levels ($49K-51K).
If BTC does continue to push higher I don't think that market sentiment is bullish enough to take it through the upper band. Too many participants will view it as a chance to take profit as they wait out the uncertain mid-term financial climate. Current volume is also underwhelming, not suggesting a huge amount of confidence in the market.
I am looking for support above £48K (low probability) or back down at $39K (higher probability) to take potential long trades.
This is not financial advice. DYOR. Thoughts welcomed below.
Comment:
Moving to the hourly chart to see how BTC is responding to the WR1 upper band. As we can see this key level was tested once and then notice how the second top was not able to break the high of the first top. This is a classic double top and a strong sign that a reversal is going to occur because it is telling us that the buying pressure is just about finished. Volume is also declining which is bearish.
There is a potential short-term trade to short if price slips below the neckline (black line). Let's hope BTC can show strength here and retake the upper band at $48K but its not looking strong.
There is a potential short-term trade to short if price slips below the neckline (black line). Let's hope BTC can show strength here and retake the upper band at $48K but its not looking strong.
Comment:
BTC has been fighting but now has broken the neckline. Classic Bart pattern developing...
So what is the outlook?
- Sentiment generally seems to be turning bullish. Alts are popping off and Alts have outperformed BTC for the last 4 weeks, albeit by small percentages. Total crypto market cap is up 20% and back above 2T. S&P and Nasdaq are up in the past 2 weeks although it looks like they are loosing bullish momentum.
- BTC has punched through the BMSB, as shown on the chart. Many people view this as an indication that the market is technically bullish.
- BTC has an additional 6 weeks of trading within this range so this will act as resistance if the price fails and it starts to retest lows.
As noted in the original idea, I am still looking for support above £48K, as shown in red on the screenshot. If BTC can find support here, and stay above the BMSB for a number of periods a long trade with targets at previous ATH (all time high) will be in play.
Given the uncertain geopolitical situation the markets may also act unpredictably so having good risk reward and stop loss strategy is more important than ever.