Hello and welcome to this volatile and uncertain time in BTC history!!
We have crypto bank shutdowns and bailouts, Balaji putting a $2M bet that we see $1M Bitcoin in 90 days, and so much more happening.
Mass adoption is possible sooner than we thought, as is more extreme and coordinated government attacks, regulation and enforcement that would stifle BTC for years.
Things couldn't be more exciting.
So what are the charts telling us?
The most obvious pattern is the broadening formation, that looks like a megaphone.
It is telling us the market is volatile and uncertain with a major event on the horizon that could go either way, with increasing swings between buyers and sellers.
A short term swing trader would want to enter short here and watch for the next swing down to the declining trend line.
However, this is a below average pattern for predictability!
Until there is a breakout, that is.
What longer term investors like me will want to do is wait for that breakout. From there the pattern tends to be much more predictable.
Using the excellent analysis in "Encyclopedia of Chart Patterns" and "thepatternsite.com", I present the 3 most likely scenarios to watch for.
Scenario 1: Watch for a break of the upper trend line to make a high-confidence long entry. From there we go to $40K with 66% accuracy.
Scenario 2: A partial decline, where the price starts back into a downtrend, but then shifts back up towards the ascending upper trend line. From there, it's a 72% chance it breaks upwards and reaches the target ($42-45K, depending on where the breakout is). Also a high-confidence long entry.
Scenario 3: A trip all the way back to Goblin Town (the bottom declining trend line), and if it breaks that trend line to the downside, there's a 42% chance it will get very, very ugly... like back to 4 digit BTC!! This would be a good time to "back up the truck."
Let's wait a bit longer and see how it plays out!!
Good Luck and Enjoy!!
We have crypto bank shutdowns and bailouts, Balaji putting a $2M bet that we see $1M Bitcoin in 90 days, and so much more happening.
Mass adoption is possible sooner than we thought, as is more extreme and coordinated government attacks, regulation and enforcement that would stifle BTC for years.
Things couldn't be more exciting.
So what are the charts telling us?
The most obvious pattern is the broadening formation, that looks like a megaphone.
It is telling us the market is volatile and uncertain with a major event on the horizon that could go either way, with increasing swings between buyers and sellers.
A short term swing trader would want to enter short here and watch for the next swing down to the declining trend line.
However, this is a below average pattern for predictability!
Until there is a breakout, that is.
What longer term investors like me will want to do is wait for that breakout. From there the pattern tends to be much more predictable.
Using the excellent analysis in "Encyclopedia of Chart Patterns" and "thepatternsite.com", I present the 3 most likely scenarios to watch for.
Scenario 1: Watch for a break of the upper trend line to make a high-confidence long entry. From there we go to $40K with 66% accuracy.
Scenario 2: A partial decline, where the price starts back into a downtrend, but then shifts back up towards the ascending upper trend line. From there, it's a 72% chance it breaks upwards and reaches the target ($42-45K, depending on where the breakout is). Also a high-confidence long entry.
Scenario 3: A trip all the way back to Goblin Town (the bottom declining trend line), and if it breaks that trend line to the downside, there's a 42% chance it will get very, very ugly... like back to 4 digit BTC!! This would be a good time to "back up the truck."
Let's wait a bit longer and see how it plays out!!
Good Luck and Enjoy!!
Note
OK, OK! You've convinced me. I'll make a prediction.
Scenario 2. Partial decline. To $22-24K. Then to $43K. Fast.
Let's See!
Note
Going right up against the ascending trend line here at $28,100.I would confidently confirm a "Scenario 1" breakout today and enter long at $28,500.
If that happens, strap in for trading hours on Monday, starting with the Asian markets!
Note
No $28,500. No entry. We are back under the upper trend line.
I will keep watching. For now it is a good practice of patience and being sure to make a high-confidence entry, not forcing a bad one.
Trade active
Breakout to the upside of the broadening formation and the bullish pendant.Target: $40,000
Stop Loss: $28,000
Note
We have not broken out of this broadening pattern yet. The price has been dancing along the upper trend line I drew for the last month with no decisive breakout.
All Scenarios are still in play, including Scenario 3 - a dip back to the cycle low of $15K
There is a nice bullish trend for now, but this pattern is still in play and we are at the high end of it. Be cautious.
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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.
Related publications
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.