Bitcoin possible correction incoming.
With bitcoin correcting a bit over the weekend, we could be looking at a bigger correction wave playing out before we move up again.
Corrections most of the times play out in 3 impulses:
1: The initial leg down
2: A relief bounce
3: Second leg down
The target of the 3rd leg can be easily measured by a trend fib and most of the times has the same length as the 1st leg down, and thus reaching the 1.00 level on the trend fib. What is interesting in this possible scenario is the confluence with a very strong level of support. The 1.00 level is perfectly matched up with a strong support level of which we did not bounce 1,2 or 3 times, but 7(!) times. This scenario is not good to play a short, but it could be a very solid level to long the market. Easy invalidation would be to close a candle above the highs of the relieve bounce.
Corrections most of the times play out in 3 impulses:
1: The initial leg down
2: A relief bounce
3: Second leg down
The target of the 3rd leg can be easily measured by a trend fib and most of the times has the same length as the 1st leg down, and thus reaching the 1.00 level on the trend fib. What is interesting in this possible scenario is the confluence with a very strong level of support. The 1.00 level is perfectly matched up with a strong support level of which we did not bounce 1,2 or 3 times, but 7(!) times. This scenario is not good to play a short, but it could be a very solid level to long the market. Easy invalidation would be to close a candle above the highs of the relieve bounce.
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Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.