BITCOIN - About Fractal, 'Clean Areas', Reversal SignsAgain, we have to analyze current BTC price movements on the Daily chart, to be said, nothing clear, mixed signs from here from there but overall the momentum should start to slow down, or not!?! Yes, exactly, the current situation is like this!
Yesterday I "warned" you that we may get another pump after the breakout from the ascending triangle to the $5,400-500 level. The price made a clean breakout and it reaches almost into these levels but most importantly it touches the Fibonacci golden retracement rate 62%. After the touch, it got a pretty high volume and the price got pushed back down, back below the well-known $5,000.
Now, we have two Daily candles rejection from the strong area (light blue fat line) and yesterday's candle close gave us a bearish candlestick pattern. There start to come more signs that the price may make a correction downwards.
Bearish signs:
1. Two rejections from a historically strong area
2. Two rejections from the round number $5,000 which works as a resistance level
3. Fibonacci touch and bounce back from the 62% level
4. After the rejection from those levels, we got a bearish candlestick pattern called Shooting Star.
5. We have got two short-squeeze, first one was that black candle and the second one, a bit smaller, was yesterday (yesterday's candle range was also pretty high considering the average - around $560)
Actually a pretty nice sell setup on the normal market situation but right now we have to consider that power from bulls. A little bit about reversal trades - the setup may be pretty strong but if the price approaching that strong area whit massive and powerful candle then it is always riskier and unexpectable to trade this. Currently, we starting to get signs which could possibly make a reversal and the throwback may start pretty soon but..
At the moment the price is in this area where it can make easily a movement to the $6,000 or back into the $4,000. The market doesn't accept those clean areas and those strong candles, usually, it wants to fill those candle whit "normal" price movements and so as now. The price has touched the Fibo level and now it has almost a clean run to the $5,800-$6,000 but in downwards it has also that stupid clean area. The next stronger support (after the first observe) is around $4,200 but there are multiple areas where it could find a support - curve trendlines, Fibo levels etc. So, we may see, on the next days, more those high range candles - watch out for that.
As said before, then there are signs that the price may take a reversal but if we look at the behavior, how it drops below the well-known 2018 support level $6,000, then this scenario is also a possibility:
* Big drop, currently, big pump
* Hammer after the drop, currently, Shooting Star after the pump (Same reversal candlestick patterns)
As you see still, anything can happen at this current level.
Yesterday, was a great sign that the lower timeframe chart pattern worked really nicely (this ascending triangle pattern) which gives me a confirmation that I can make lower timeframes analysis on the next updates. Let's collect just a little bit more data to be more precise.
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Have a nice day,
Best regards!
*This information is not a recommendation to buy or sell, it is used for educational purposes only!
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