It’s hard to believe that the +43% move that Bitcoin experienced was almost two weeks ago. It’s hard to believe that we didn’t see Bitcoin sell off from that pump. Bitcoin continues to consolidate inside the 9000 and 9500 value area – something it has done for the past twelve days. This is a chart we (and I) have not looked at in a long while. The geometry on this chart is part of my own augmented Gann Square of 52. Something that I find fascinating about technical analysis is how the various styles and methods can confirm particular price levels. The same current resistance zones that exist on this chart can be confirmed with the Ichimoku System, Point and Figure charts, Hurst Cycles, and various other forms of analysis.
The chart above is Bitcoin’s daily chart. Several key areas need to be examined that help explain the difficulty Bitcoin is having from moving higher. First, is the red horizontal line just above Bitcoin’s current price at 9452.41. That line is a 6/8th inner harmonic pivot and acts as a natural resistance level. It is the strongest resistance level between now and the 4/8th Major Harmonic at 10082.50. The 6/8th inner harmonic is also the support level from the bullish pennant that formed off of the June 2019 high. The top of the current regression channel is also adding to this resistance. The closest arc ends on November 14th, and because price likes to stay away from these arcs, we often see prices move very quickly to avoid trading inside or around these arcs. We should expect to see some very volatile moves over the next week.
It is currently much easier for Bitcoin to travel lower than higher. This mainly due to the Volume Profile. There is a high volume node at 8192.22 (which is also the 2/8th inner harmonic) and a high volume node above at 10100. The volume trough at 8847 should of concern for any short term traders. Low volume nodes (volume troughs) are areas that price can get sucked into like a vacuum. The trading theory and price behavior we should expect to see if price breaks down below 9072 is a mini-flash crash down to 8192. And that move may be a necessity. I’ve been watching the Volume Profile very closely all of 2017, 2018, and 2019 and Bitcoin likes to backfill these areas that are left open. This has been especially true since all the time high. This should be taken as evidence that Bitcoin is stair-stepping support levels as it slowly trudges higher. The ultimate near term resistance that needs to be broken is the powerful technical and psychological level at 10,000. We should expect to see Bitcoin face resistance between 8500 and 10,000 due to the strength and importance of this price level. However, given the halving event that will occur next year and given the cyclical repetition that Bitcoin is experiencing, we will more than likely see Bitcoin exceed 10,000 before the end of 2019.