Bitcoin Patterns and Logarithmic Trendline Support at $7.4K
On the hourly analog Bitcoin Bitfinex chart, you can see how the market is slowly building some support between the $7,300 and $7,500 level.
Yesterday, I found a nice bearish wedge in black that was building, which I have highlighted on the chart below and you can see how price tapped that blue 50 hour moving average twice before falling lower, all the way back down to the lows on the day of $7,318.
Price has recovered a bit since than but the turquoise 20 hour moving average and blue 50 hour moving average continue to give price some decent resistance. You can see how price tapped that turquoise line about 4 time earlier today before heading downward again.
The bullish news is that there is a triangle that is forming in purple which could break either way, as price is driven into the corner. The fact that the 20 day MA held price down today and that it was unable to revisit the top of the purple channel is not a good sign for any bullishness.
Even if this purple triangle breaks to the downside, I am not sure if price will go anywhere fast. I believe many people have capitulated already and I think a lot of the money is waiting on the sidelines to see what may happen next.
All three indicators, the RSI, MACD, and CCI are all showing hidden continued bearish divergence marked with a red line on each, due to the higher highs and the lower highs on the price chart. Otherwise everything is pretty neutral for now and not much is happening.
Once that 20 hour moving average comes down a bit further and decides to test price again, we will see if price is off to new lows. I think price will tap that lime green at $7,500 one more time too, but I still believe in the $7,200 - $7,050 as a target over the weekend.
On the daily analog Bitcoin Bitfinex chart, there’s not a whole lot to update from yesterday, but we are still looking at the convergence at the blue .786 fib line, the blue bottom side of this big triangle and the pink down trending channel as potential support around $7,179.
That turquoise line running across the screen also has .65 long term fib support at $7,036 and could be an area for the any potential wick.
My expectations on the bullish side are pretty low at the moment, meaning probably a great time to buy! But as usual not financial advice and always do your own research.
OK, but if we do manage to get some rally over the weekend, it could be very surprising and much more than we expect. Conservatively a rally back up to the top of a pink channel around $7,700 or $7,600 would be nice and possibly back to the $8,050 level where there is horizontal support, but I am still feeling downside momentum still.
The indicators are all very low here as well, and not still not showing any signs of turning, which is no fun.
One more bonus chart because it's a happy Friday and this is just a zoomed out version of the daily logarithmic Bitcoin Bitfinex chart and I have drawn a big purple trend line connecting some of the highs and lows from the past few months, back to the low of $83 in October 2013.
It’s a bit crude, but when you zoom in closer on that chart the trend line is heading right through $7,426, a shade above where price is situated right now. I find some of these logarithmic trend lines incredible in how they sit perfectly with long term price points.
My point is that despite what the indicators and price is dictating currently this should be a solid area of support or resistance even if price does break down precipitously again. Even in the lows of September last year, this line provided staunch support while price battled back above it for almost two weeks. Either way it’s nice for hope and perspective.
Yesterday, I found a nice bearish wedge in black that was building, which I have highlighted on the chart below and you can see how price tapped that blue 50 hour moving average twice before falling lower, all the way back down to the lows on the day of $7,318.
Price has recovered a bit since than but the turquoise 20 hour moving average and blue 50 hour moving average continue to give price some decent resistance. You can see how price tapped that turquoise line about 4 time earlier today before heading downward again.
The bullish news is that there is a triangle that is forming in purple which could break either way, as price is driven into the corner. The fact that the 20 day MA held price down today and that it was unable to revisit the top of the purple channel is not a good sign for any bullishness.
Even if this purple triangle breaks to the downside, I am not sure if price will go anywhere fast. I believe many people have capitulated already and I think a lot of the money is waiting on the sidelines to see what may happen next.
All three indicators, the RSI, MACD, and CCI are all showing hidden continued bearish divergence marked with a red line on each, due to the higher highs and the lower highs on the price chart. Otherwise everything is pretty neutral for now and not much is happening.
Once that 20 hour moving average comes down a bit further and decides to test price again, we will see if price is off to new lows. I think price will tap that lime green at $7,500 one more time too, but I still believe in the $7,200 - $7,050 as a target over the weekend.
On the daily analog Bitcoin Bitfinex chart, there’s not a whole lot to update from yesterday, but we are still looking at the convergence at the blue .786 fib line, the blue bottom side of this big triangle and the pink down trending channel as potential support around $7,179.
That turquoise line running across the screen also has .65 long term fib support at $7,036 and could be an area for the any potential wick.
My expectations on the bullish side are pretty low at the moment, meaning probably a great time to buy! But as usual not financial advice and always do your own research.
OK, but if we do manage to get some rally over the weekend, it could be very surprising and much more than we expect. Conservatively a rally back up to the top of a pink channel around $7,700 or $7,600 would be nice and possibly back to the $8,050 level where there is horizontal support, but I am still feeling downside momentum still.
The indicators are all very low here as well, and not still not showing any signs of turning, which is no fun.
One more bonus chart because it's a happy Friday and this is just a zoomed out version of the daily logarithmic Bitcoin Bitfinex chart and I have drawn a big purple trend line connecting some of the highs and lows from the past few months, back to the low of $83 in October 2013.
It’s a bit crude, but when you zoom in closer on that chart the trend line is heading right through $7,426, a shade above where price is situated right now. I find some of these logarithmic trend lines incredible in how they sit perfectly with long term price points.
My point is that despite what the indicators and price is dictating currently this should be a solid area of support or resistance even if price does break down precipitously again. Even in the lows of September last year, this line provided staunch support while price battled back above it for almost two weeks. Either way it’s nice for hope and perspective.
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.