These past few weeks has been really bearish! The C&H pattern did not hold, and we broke down (see previous post). This break down started a very steep decline in price.
In the chart above we can see BTC dropped almost 53% towards 3800 ~ 3900 USD. It broke right through the 100 and 200 weekly MA. There BTC got a lot of support from a high volume node, before bouncing back above the large yellow trendline. Currently, BTC is hanging at the 200 weekly MA combined with the 0.786 FIB level. BTC never closed below the 200 weekly MA. If it does close below, we could be in for a far bigger decline than we experience the last few weeks. The coming hours are very important!
A close above would confirm the strong support at the 200 weekly MA, and probably result in a longer consolidation/sideway movement. The CHOP index needs to recover and prepare for a next big move. If this happens, we need to keep an eye on the smaller timeframes, because all smaller timeframes are in a downtrend as well. Changes start from the inside out. Uptrend on the smaller timeframes will translate in an uptrend in the larger timeframe.
Until we close the weekly chart, I wouldn't recommend taking any long or short position. We need a confirmation first! If we consolidate, look for an upward or downward channel to trade. If we close below, I'll short from 5000 USD with a price target of 3900 USD (high volume node support).
Stay safe and focus on price. Don't let news headline blur your view!
In the chart above we can see BTC dropped almost 53% towards 3800 ~ 3900 USD. It broke right through the 100 and 200 weekly MA. There BTC got a lot of support from a high volume node, before bouncing back above the large yellow trendline. Currently, BTC is hanging at the 200 weekly MA combined with the 0.786 FIB level. BTC never closed below the 200 weekly MA. If it does close below, we could be in for a far bigger decline than we experience the last few weeks. The coming hours are very important!
A close above would confirm the strong support at the 200 weekly MA, and probably result in a longer consolidation/sideway movement. The CHOP index needs to recover and prepare for a next big move. If this happens, we need to keep an eye on the smaller timeframes, because all smaller timeframes are in a downtrend as well. Changes start from the inside out. Uptrend on the smaller timeframes will translate in an uptrend in the larger timeframe.
Until we close the weekly chart, I wouldn't recommend taking any long or short position. We need a confirmation first! If we consolidate, look for an upward or downward channel to trade. If we close below, I'll short from 5000 USD with a price target of 3900 USD (high volume node support).
Stay safe and focus on price. Don't let news headline blur your view!
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