Bitcoin: 3 steps to lift-off
In order for me to give Bitcoin the all clear for the official end of the bear and confirmation of the bull, I must see these 3 things first:
Step 1: Upside break above the parallel down channel which has been the overriding structure containing bitcoin price action. Looking at the 8-hour chart, you can see this has already been achieved. Personally, I would like to see a weekly break and close above the channel as it is such a long-term structure.
Step 2: Upside break above the inverted head and shoulders (orange annotations) neckline at the 11,500 level. This would validate the structure and lend greater confluence for 17,000 as an upside target.
Step 3: Upside break above 13,000 major resistance. This is a very significant level which served as the neckline support within the head and shoulders structure that developed in December and January (yellow annotations). On January 16th, the downside break of this neckline occurred which validated the head and shoulders structure and subsequently caused a large selloff in bitcoin down to the 6,000 target.
An extra layer of confluence for 13,000 as major resistance is when overlaying the Fibonacci retracement tool connecting the January 7th high (top of channel) to the February 6th low (bottom of channel), you can see that the 61.8% retracement is near perfectly on 13,000.
If step 3 is completed, only then will I be long bitcoin with a clear target at 17,000.
Step 1: Upside break above the parallel down channel which has been the overriding structure containing bitcoin price action. Looking at the 8-hour chart, you can see this has already been achieved. Personally, I would like to see a weekly break and close above the channel as it is such a long-term structure.
Step 2: Upside break above the inverted head and shoulders (orange annotations) neckline at the 11,500 level. This would validate the structure and lend greater confluence for 17,000 as an upside target.
Step 3: Upside break above 13,000 major resistance. This is a very significant level which served as the neckline support within the head and shoulders structure that developed in December and January (yellow annotations). On January 16th, the downside break of this neckline occurred which validated the head and shoulders structure and subsequently caused a large selloff in bitcoin down to the 6,000 target.
An extra layer of confluence for 13,000 as major resistance is when overlaying the Fibonacci retracement tool connecting the January 7th high (top of channel) to the February 6th low (bottom of channel), you can see that the 61.8% retracement is near perfectly on 13,000.
If step 3 is completed, only then will I be long bitcoin with a clear target at 17,000.
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