Hi Traders,
This analysis is on the STEEM/BTC pair on the 120 timeframe (poloniex).
Well, it looks like price retested the lows for the fourth time in the PRZ (Potential Reversal Zone) and once again support held, but not after price reached a new 24 hour low at 0.00302001 BTC.
When price consolidates like this after the completion of the Bullish Butterfly
it becomes tricky to trade and is one of the more difficult scenarios one encounters in harmonic trading. This example is harder to trade because in harmonic trading we are used to seeing impulsive moves... and this is not the case.
What does this mean?
This means that we should be more patient and wait for a good signal to go long.
...and we might have one right here.
It looks like the steem bulls defended the 0.003 BTC handle very nicely and we had a nice upside reaction. This could be a sign that the bears have run out of "steem". -pun intended.
In addition, RSI is in oversold territory and is beginning to head north which is an indicator that we might have a reversal. Another thing to note is RSI often likes to retest the oversold area once or twice before making a move so it is possible to see price retest the previous low of the day.
If price fails to breakout to the upside and if support fails to hold for this last time we could expect to see new lows and test the 1.414 fibonacci extension around 0.00264 BTC seen below.
If this occurs I will be stopped out of my trade around 0.003 BTC and will be looking for a possible long entry in the 0.0026 BTC-0.0025 BTC range depending on price action.
If you have been following my previous analysis here and have watched my live trade in action you will know I have been bullish on STEEM. You can watch this trade play out live and see my up to date comments right here on TradingView
Please feel free to question, comment and post your charts and technical-analysis in the comments section below.
Disclaimer
This is not financial advice and is for educational purposes only.
Harmonic Trading was invented by Scott Carney
Please follow me on Twitter for all things crypto and on TradingView.
Happy trading!!