Potential do or die for Bitcoin at 61.8.
Updated
Good morning, traders. The week is winding down but Bitcoin appears to be heating up. Overnight we saw price dip down to around $6128 on Bitfinex. As mentioned in the live streams, this has been a possibility and it took price to the 61.8% fib area which is perfect for getting the most bang for your buck out of a retracement.
Taking a look at the 1H chart, we can see that volume picked up as price neared the apex of the consolidation within the trading range (TR). As mentioned during the live stream, this current area of price movement is very risky with little reward and if I were to trade it then I would've waited for a breach of the top or bottom of that TR before going long or short. The latter would've had me watching for price to reach the 61.8% retracement level. Remember, there are no guarantees in trading but as long as the blue box holds up, we are good to go for continued price appreciation. As we can see on this chart, there is clear bullish divergence between MACD's negative histogram and price, and this is also noticeable in RSI's general movement. The latter has seen continual overall higher lows since June 22nd, which was prior to price actually reversing, and is usually a good indicator of that price reversal. OBV is also bouncing from its own support area. Price is printing a bull flag at the moment which has us expecting a breach of its resistance and some upward momentum. The same areas we have been watching for support and resistance remain relevant at this time and are highlighted in the chart.
The 1D chart gives us a better look at the overall price action. Possible price movement is shown with the wave count. I noticed that this potential Wave 2 appears to be composed of 5 waves. If so, and it isn't a complex correction as would need to be verified by detailed analysis at much smaller time frames, then it would be just the A wave of a possible ABC correction. This means we should only expect limited upward movement in order to complete Wave B and then one more trip down to complete Wave C before, finally, continuing up with Wave 3. Of course, two more possible ideas are that 1) this last set of 5 waves up could've been the C wave of a bearish correction and this movement down could be the start of another series of waves lower or 2) this movement down is the B wave of that correction with one more move up for the C wave before another series of waves lower. These are always the kinds of possibilities that occur at potential reversal areas, however, which is what makes them risky to trade and results in most traders losing money. The IHS is still in play at this time, though I believe there are other things more important to consider as we watch price action.
Taking a look at the 1H chart, we can see that volume picked up as price neared the apex of the consolidation within the trading range (TR). As mentioned during the live stream, this current area of price movement is very risky with little reward and if I were to trade it then I would've waited for a breach of the top or bottom of that TR before going long or short. The latter would've had me watching for price to reach the 61.8% retracement level. Remember, there are no guarantees in trading but as long as the blue box holds up, we are good to go for continued price appreciation. As we can see on this chart, there is clear bullish divergence between MACD's negative histogram and price, and this is also noticeable in RSI's general movement. The latter has seen continual overall higher lows since June 22nd, which was prior to price actually reversing, and is usually a good indicator of that price reversal. OBV is also bouncing from its own support area. Price is printing a bull flag at the moment which has us expecting a breach of its resistance and some upward momentum. The same areas we have been watching for support and resistance remain relevant at this time and are highlighted in the chart.
The 1D chart gives us a better look at the overall price action. Possible price movement is shown with the wave count. I noticed that this potential Wave 2 appears to be composed of 5 waves. If so, and it isn't a complex correction as would need to be verified by detailed analysis at much smaller time frames, then it would be just the A wave of a possible ABC correction. This means we should only expect limited upward movement in order to complete Wave B and then one more trip down to complete Wave C before, finally, continuing up with Wave 3. Of course, two more possible ideas are that 1) this last set of 5 waves up could've been the C wave of a bearish correction and this movement down could be the start of another series of waves lower or 2) this movement down is the B wave of that correction with one more move up for the C wave before another series of waves lower. These are always the kinds of possibilities that occur at potential reversal areas, however, which is what makes them risky to trade and results in most traders losing money. The IHS is still in play at this time, though I believe there are other things more important to consider as we watch price action.
Note
This bullish pattern has also appeared in the chart. Expectation, based on this pattern, should be that price makes a good move up at least in the short term.
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