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BTC May Be Stalling at Symmetry Resistance
Updated
BTC May Have Stalled Right at Symmetry Resistance
BTCUSD may have stalled today at symmetry resistance today. The symmetry resistance is measured using a Fibonacci-style projection (called an extension on the TV tool settings). The levels derive from projections of prior counter-trend rallies since the YTD low on June 18, 2022.
The first symmetry resistance lies at 22,710.95. The second symmetry resistance lies at 23,024.65. This area is right where price stalled today and pulled back significantly. Note that these two resistance levels are green-colored Fibonacci projection lines. And these two price points are highlighted with an orange circle (blue border). In short, they project the first two corrective waves off June 18 lows from the most recent low (designated by a blue arrow).
This symmetry level coincides almost exactly with the top of the parallel trading channel (bear flag) in which BTC has traded since its June 18 low.
The fact that price reversed here suggests that the breakout in volatility may likely be accompanied by a resumption of the larger-degree downtrend.
But price must be given a chance to retest the top trendline of the bear-flag channel as well as symmetry resistance. It may even attempt a whipsaw break (i.e., a false breakout) up to the 1.272 extension, a common target when using Fibonacci projections. Those lie at the second orange circle on the chart above: 23,746.02–24,229.36. Price doesn't have to do anything we think it should, but this merely suggests a possibility of 1.272 projections being tested before the looming breakout (described in my related post below).
Volatility Compression Suggests Looming Breakout
Previous posts discuss potential Fibonacci targets as well as the volatility compression that has developed in BTC's price action over the past month. This volatility compression signals a likely volatility expansion. Typically, breakouts in volatility accompany breakouts in price ranges. Although many bottom-pickers may attempt to view each new downdraft as the final low, the more reliable approach is to favor trend continuation over trend reversal as the higher-probability scenario. See, e.g., tradingview.com/chart/BTCUSD/IU2NgMbo-BTC-Squeezing-in-Channel-Breakout-Looms/.
The past 7 months presents an excellent example of this concept. Those favoring trend continuation at each new low in BTC or
ETHUSD YTD have had much more success (protecting capital, profiting from directional trades) than those expecting major trend reversal upon each corrective rally.
BTC1!
BTCUSD
BTCUSD
BTCUSD
BTCUSDT
BTCUSD may have stalled today at symmetry resistance today. The symmetry resistance is measured using a Fibonacci-style projection (called an extension on the TV tool settings). The levels derive from projections of prior counter-trend rallies since the YTD low on June 18, 2022.
The first symmetry resistance lies at 22,710.95. The second symmetry resistance lies at 23,024.65. This area is right where price stalled today and pulled back significantly. Note that these two resistance levels are green-colored Fibonacci projection lines. And these two price points are highlighted with an orange circle (blue border). In short, they project the first two corrective waves off June 18 lows from the most recent low (designated by a blue arrow).
This symmetry level coincides almost exactly with the top of the parallel trading channel (bear flag) in which BTC has traded since its June 18 low.
The fact that price reversed here suggests that the breakout in volatility may likely be accompanied by a resumption of the larger-degree downtrend.
But price must be given a chance to retest the top trendline of the bear-flag channel as well as symmetry resistance. It may even attempt a whipsaw break (i.e., a false breakout) up to the 1.272 extension, a common target when using Fibonacci projections. Those lie at the second orange circle on the chart above: 23,746.02–24,229.36. Price doesn't have to do anything we think it should, but this merely suggests a possibility of 1.272 projections being tested before the looming breakout (described in my related post below).
Volatility Compression Suggests Looming Breakout
Previous posts discuss potential Fibonacci targets as well as the volatility compression that has developed in BTC's price action over the past month. This volatility compression signals a likely volatility expansion. Typically, breakouts in volatility accompany breakouts in price ranges. Although many bottom-pickers may attempt to view each new downdraft as the final low, the more reliable approach is to favor trend continuation over trend reversal as the higher-probability scenario. See, e.g., tradingview.com/chart/BTCUSD/IU2NgMbo-BTC-Squeezing-in-Channel-Breakout-Looms/.
The past 7 months presents an excellent example of this concept. Those favoring trend continuation at each new low in BTC or
ETHUSD YTD have had much more success (protecting capital, profiting from directional trades) than those expecting major trend reversal upon each corrective rally. BTC1!BTCUSDBTCUSDBTCUSDBTCUSDTTrade closed: target reached
BTC tagged and stalled the symmetry resistance and then went on to tag and stall at the 1.272 extension area highlighted above. Even though prices have stalled, the breakout to the upside leaves price action in an uncertain / indecisive area. After the stalling out at 24,200 area at the 1.272 extension. BTC has fallen somewhat. Prices could resume higher just as easily as resuming the downtrend at this point.
Trade closed: target reached
Price reached and stalled at the 1.272 projections of the first two waves of the bear-flag channel. These projection levels at 23,746 and 24,229 were identified as possible higher upside targets that were possible beyond the initial 1.00 symmetry levels (where the final wave up had equality with the first two waves up). Near term, price action remains uncertain. A case can be made for bullish or bearish near term directional moves.
Because price action stalled and pulled back about -9.6% from the 1.272 projections at 23.7K - 24.2K, this idea will be closed given that the forecasted conditions have been narrowly satisfied.
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