Daily here.. Pretty clear what BTC is trying to do currently. Flirting with the first heavy resistance trend line and rejected heavily during the early hours of this morning.. Not a good sign, but also not a terrible sign. Let's zoom in to see if we can figure out a bias..
Ok so a few things stand out here on the 4 hour..
- the last week or two looks very much like redistribution. heavy volume on the selling tells us the selling is real
- RSI denied from the bullish zone on this past push up to 11k and clear bearish divergence.. doesn't mean the move is over but a nasty rejection for sure.
- Godmode indicator giving a heavy sell signal near the top last night.. still nowhere near signaling a buy. Not the end all be all indicator but would be nice for confluence
- Notice the fib levels and how BTC never dropped lower to the more stable zones of 0.5 and 0.613, instead BTC stayed up which signals an extremely bullish environment.. but the thing is, it was denied so could we just be looking to consolidate at a lower level before trying up? definitely possible so that scenario is on the table still
Zooming in a little more to the 2 hour here..
A couple things here for the bullish case..
- Clear consolidation forming up.. call it whatever you want to, I suppose most will be referring to it as ascending triangle
- volume trailing off during this period, makes me lean towards this being some healthy consolidation/pullback
As long as BTC holds the bottom support around about 10k, this would be the scenario I lean towards, also coincides with an inverse head and shoulders (which actually does have the characteristics of one)
This is what an actual inverse head and shoulders could look like. has the characteristics and volume signatures with the correct price action so far. these actually have a very very high chance of playing out -when it actually is one, which almost everyone gets wrong-
Confirmation for that scenario would be a daily close above the upper resistance trend line around about 11.5k. If confirmed then the measured move could take us around 16.5k area (general estimation, not exact)
What about the bearish case?
Well I wouldn't have a bearish bias until we have a daily close underneath 10k, even then I still wouldn't be looking for a lower low until theres a daily close underneath 8.9k. IF that occurs then I would be leaning towards seeing somewhere in the low 5k region to upper 4k as that is an area where the parabolic advance began months ago.
Lastly, let's look at longs vs shorts and see if theres anything there..
20k shorts here about
29k longs here about
So this is actually in a way bullish in my eyes.. we have a significant number of shorts now which provides rocket fuel for liquidations, we can also see that a majority of these shorts opened around mid 9k meaning these guys are underwater so at which point do they feel enough pain to become buyers? Hard to tell, some of these guys have so much coin that it doesn't matter and they can hold it for thousands of dollars as it rallies against.
Regardless, I would expect algo traders and these shorts to switch their strategy to long IF BTC can close above the 12.5k area as that is an algo target and coincides with the long term log downtrend.
So as always its difficult here, I would be leaning towards seeing 12k before seeing 8k right now, but there are significant signs for both the bulls and bearish scenarios. So my triggers are neutral if daily closes under 10k, ultra bearish if daily closes under about 8.8k, bullish if daily closes over 11.2k, ultra bullish if daily closes above 12.5k