It Bitcoin gearing up for a large upward move?
Hello Everyone,
Bitcoin has seen a 50%+ correction in price over the last 2 months. During this period, a lot of people went from bullish to bearish. Between the FUD, Elon Musk tweets, etc who could blame them? What if I told you none of that affected price? The market was showing signs of upward exhaustion far before $65,000. Price action was bearish as price was going up and volume was going down. Not to mention many alt coins were doing 10-100x in a few days. A large correction was needed.
With all of the dumpiness taking place, I had decided to slowly DCA the price drops as I did not want to catch the falling knife. Also, I did not know where this drop would eventually lead. However, I have noticed a few things over the last 2-3 weeks that make me believe a large upward move could be in the works. Here's my analysis:
1. There is a possible Inverted Head and Shoulders Forming. the HS and IHS pattern indicate trend reversal.
2. Volume is going down as price is going down. This is bullish price action and indicates selling exhaustion.
3. RSI has broken its upper trend line. I expect a move to 34k-
36K for true confirmation but this could indicate a trend change.
4. Bitcoin's bull market still has room to go. Both bull markets in the past ended between Nov-Dec. It is July.
5. MACD could indicate a trend reversal if it crosses the intersection point to from bearish to bullish.
With all of this said, traders need to be patient and wait for confirmation. Bitcoin is still in a place where more dumpiness can occur. Personally, I have learned that DCAing in a bear market seriously pays off a couple years from now (yes technically we are still in a bear market below daily 200MA). If you are looking at trading this pattern, you would buy at the bottom of the left shoulder and at the breakout at the neckline confirmed by price action.
As always, be patient, use risk management, and good luck trading!
Bitcoin has seen a 50%+ correction in price over the last 2 months. During this period, a lot of people went from bullish to bearish. Between the FUD, Elon Musk tweets, etc who could blame them? What if I told you none of that affected price? The market was showing signs of upward exhaustion far before $65,000. Price action was bearish as price was going up and volume was going down. Not to mention many alt coins were doing 10-100x in a few days. A large correction was needed.
With all of the dumpiness taking place, I had decided to slowly DCA the price drops as I did not want to catch the falling knife. Also, I did not know where this drop would eventually lead. However, I have noticed a few things over the last 2-3 weeks that make me believe a large upward move could be in the works. Here's my analysis:
1. There is a possible Inverted Head and Shoulders Forming. the HS and IHS pattern indicate trend reversal.
2. Volume is going down as price is going down. This is bullish price action and indicates selling exhaustion.
3. RSI has broken its upper trend line. I expect a move to 34k-
36K for true confirmation but this could indicate a trend change. 4. Bitcoin's bull market still has room to go. Both bull markets in the past ended between Nov-Dec. It is July.
5. MACD could indicate a trend reversal if it crosses the intersection point to from bearish to bullish.
With all of this said, traders need to be patient and wait for confirmation. Bitcoin is still in a place where more dumpiness can occur. Personally, I have learned that DCAing in a bear market seriously pays off a couple years from now (yes technically we are still in a bear market below daily 200MA). If you are looking at trading this pattern, you would buy at the bottom of the left shoulder and at the breakout at the neckline confirmed by price action.
As always, be patient, use risk management, and good luck trading!
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