BTC tests Crucial Region to Rebound or Retrace
Updated
We are looking at BTCUSD with Heikin Ashi Candles on a 1-Day Time Scale.
Heikin Ashi Candles are advantageous in these areas:
- It gives a quick view on whether the market is currently bearish, bullish or neutral
- It cuts out distractive noises from the chart, showing clearer trends
Now we clearly see a downtrend forming for 2 weeks and onwards, with 15 consecutive red candles. This immediately indicates the momentum that we are continuing with this downtrend in the S/R.
The indicators also shows us we are convergent with the price trend:
- RSI has been decreasing since 6 Nov, still yet to reach an oversold area
- OBV has shown decreasing volume since 6 Nov
- MACD line crossed signal line and continues below since 8 Nov
Now, where I think it will face major support is at the red region I've drawn in the chart, namely the 7.5k-7.7k region. Once it hits that region, we will see price react hugely whether to:
1: Bounce back up to test the 8.7k-8.8k major resistance
2: Falls gradually towards the $6.5-6.6k major support
Heikin Ashi Candles are advantageous in these areas:
- It gives a quick view on whether the market is currently bearish, bullish or neutral
- It cuts out distractive noises from the chart, showing clearer trends
Now we clearly see a downtrend forming for 2 weeks and onwards, with 15 consecutive red candles. This immediately indicates the momentum that we are continuing with this downtrend in the S/R.
The indicators also shows us we are convergent with the price trend:
- RSI has been decreasing since 6 Nov, still yet to reach an oversold area
- OBV has shown decreasing volume since 6 Nov
- MACD line crossed signal line and continues below since 8 Nov
Now, where I think it will face major support is at the red region I've drawn in the chart, namely the 7.5k-7.7k region. Once it hits that region, we will see price react hugely whether to:
1: Bounce back up to test the 8.7k-8.8k major resistance
2: Falls gradually towards the $6.5-6.6k major support
Note
Note
So we have seen the price follow the downtrend and break the 7.5k support level quicker than what we expect, even testing the $6.5-6.6k major support in the last 48h. However, the price has reacted strongly with a rebound up to the $7.1-7.2k region, now moving sideways. There were a total of 19 1-D red candles formed before the rebound and the last time this occurred was exactly 1Y ago, on Nov 2018. Afterwards, we witnessed a period of sideways trading for 3mos+.
RIght now we have a major support at 6.6k and a major resistance at 7.5k. Price looks to be forming a sideways movement b/n these 2 horizontals.
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