BTCUSD Wyckoff updated
Good morning, traders. Bitcoin did as expected this weekend and finally produced a new yearly low. The question is, did this move set the spring we have been discussing? As I continue to remind everyone, the bottom is a process, not an event. The spring is part of this process. Since my original Wyckoff chart was a bit old, and a few individuals have decided to concentrate on the time frames (which were never the goal) and not the price movement (which was the goal), I have updated it. The trading range (TR) is in yellow. We need to see price break $6600, which is the bottom of the TR, before we can begin to even think about anything higher. The spring will be the thrust up from the low that takes us to the TR. Does the spring begin with the move up from Sunday's low? We don't know for sure just yet. There is a strong possibility of it being so based on the large, almost $500 price swing during that daily candle, as well as the weekly swing point failure. Additionally, we can see bullish divergence on the daily RSI, %B, and MACD's negative histogram. Furthermore, MACD is nearing the apex of consolidation and should be making a large move one way or the other sooner rather than later. The weekly MACD negative histogram is showing bullish divergence between the weeks of April 2nd and June 18th. This doesn't mean we can't drop lower this week, only that we should ultimately expect to see a move up. The importance of volume in this respect is that with each test of the low throughout this likely accumulation phase, volume has decreased significantly, which tells us that absorption has been high and selling is fatigued (a bottom may be in/near). As I am writing this update, I noticed that Tether just granted another 250,000,000 USDT (here is the link: omniexplorer.info/address/3MbYQMMmSkC3AgWkj9FMo5LsPTW1zBTwXL). This has previously coincided with a bottom in the market and subsequent appreciation in price. BTCUSD shorts have fallen through the bottom of the ascending broadening wedge and BTCUSD shorts v. longs reached 0.9985 before dropping substantially, as I have been suggesting traders should monitor.
Careful attention to the current price and potential path provides a likely emergence of an inverse head and shoulders pattern. However, be aware that expansion of volume MUST accompany the break of the neckline from the right shoulder. Lack of volume = lack of follow through. If it does play out, then we would expect to see a target of the $7900-$8000 area which lines up well with the expected overall price movement. I am watching for price to breach the RSI, MACD, and %B resistance areas which should suggest bullish momentum. We still need follow through on the recent push above $6200, but it's a good start. Personally, I was expecting to see price retest the $5800-$5900 area first, especially after the recent rejection at $6250.
Careful attention to the current price and potential path provides a likely emergence of an inverse head and shoulders pattern. However, be aware that expansion of volume MUST accompany the break of the neckline from the right shoulder. Lack of volume = lack of follow through. If it does play out, then we would expect to see a target of the $7900-$8000 area which lines up well with the expected overall price movement. I am watching for price to breach the RSI, MACD, and %B resistance areas which should suggest bullish momentum. We still need follow through on the recent push above $6200, but it's a good start. Personally, I was expecting to see price retest the $5800-$5900 area first, especially after the recent rejection at $6250.
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