BTC trying to (temporarily) reverse the trend. Will it succeed?All eyes are currently on the potential inverse H&S that might be forming its right shoulder on this pullback, and if completed it could take the price to around 5300-5400 area which is the projected target of the pattern.
As we've all noticed, when everyone expects something due to it being obvious on the chart, BTC tends to do the opposite, so don't put too much hope into this iH&S pattern.
It's just an idea for now, so we can have it on our radar.
The major trend is still down.
A break of 4400 is still the main condition for those higher prices mentioned above, and without it, none of these patterns matter much.
Nevertheless, we can't ignore (at least a temporary) reversal pattern forming for over a month now.
The longer the time period over which the pattern forms, the more reliable it is and the larger the move it makes once (and if) completed.
The key areas for this scenario are marked on the chart above.
3470-3400 zone must hold, otherwise, we are likely to see 3100s retested or even new lows.
If we see a good reaction (ideally) from around 3560, that would be a first positive step towards the iH&S pattern completion.
Note that 3650 was/is the minimum retracement necessary for this to play out.
I see two ways to trade this:
1. Enter with a speculative position size in the "ideal entry zone" marked on the chart with a stop loss below 3400.
2. (safer, more conservative way) Wait for the price to breakout and close a candle above 4400 pivot point, then buy the breakout or the pullback of that move. This way you get less profits but a lot more reliability in your trade.
It all depends on your trading style and risk apetite.
Either way, stop loss and risk management is crucial here, due to the main trend still being down.
You don't want to get caught in a long position if the main trend continues to the downside.
Note that this is a 12h timeframe chart, so it may take days to play out.
