Bitcoin's Big ABC Correction or Trend Change? Part 4
Обновлено
After receiving a lot PM messages from grateful followers, i will start to post more actively again as you are used to from me. Each few weeks or months, the head of a trader gets full. With all the good trades (getting over confident) but the biggest problem, are the bad trades. This used to be very easy for me, each time i felt a little unbalance, i simply take a day or 2 off. But since i started on TV, feels like a lot of responsibility because many "depend" on me. With the 24/7 of the crypto market, making it very difficult to take small breaks even. Of course i have no obligation to anyone, but it's just who i am, as most of you early followers have known for a long time.
Anyway, past days i only posted a few updates on Bitcoin' in my free channels, where i said a potential double bottom might happen, since the 3810/820 zone was giving the bulls a hard time:
Starting to look like we might be headed for a double bottomish around 3700/3650. Depending on if we see at least a small bounce there or not.
A spike lower might happen, but only a spike! If we see a good bounce up, it could be the start of a continuation of the rally that started at 3400. If we don’t see a bounce, we have to start assuming bullish movement might be completely over for the coming weeks/months.
Yesterday i showed a potential smaller double bottom inside of the bigger one, almost identical to the one i showed a few weeks ago at the 3350/3400. The target of that small one was around 3770 which has been reached of course and at the moment we just broke the neckline of the bigger one around 3850. Just did a small break up while i am writing this, but no follow through yet though. Normally we should stay above the 3830 now so we can go towards the target of the W bottom around 3950/4000. If we break 3830/20, the attempt could fail, but so far volume looks good and bulls are holding their levels.
Bigger picture:
That "fractal" i showed a while back (yellow circles on the right) have been playing out so far. That blue line from my post of a few weeks ago might get completed now. A lot will depend on if the bulls can increase volume and break the 4000ish zone. If that happens, we could see another attempt at the 4200ish zone. If that happens, we have some kind of inverse H&S , with a big neckline around 4200. Also that higher low pattern, which remains unconfirmed below the 4200.
But confidence and volume is very important. I think we are at an important stage now, because if we can break the 4200, there will be chances for 5K+ prices. However, as you know from Part 1 of this analysis, we need to see a break of the 4600 zone. I think that is the key level between just a simply correction of the Bear trend, or that we see a much bigger correction, or possible even a trend change. I am personally not seeing a long term trend change, simply because volumes are too low in general. There is just not enough money in the crypto market.
My theory now is, a lot of people have a hedge running from the 4400/4600 zone (meaning they shorted there in Nov/Dec to protect their Dollar' value of Bitcoin ). So a break of this zone, will make all these people buy back their hedge position, fueling another push up. Probably in combo with the markets FOMO, we could see 5K+ prices.
Short term: The movement of the past week, can still all be just a correction of that big dump. Meaning, we can easily make a lower high in the 3850/4000 zone. That's why volume is so important at this stage. Because dropping volume simply means there are not enough buyers and they will loose the fight and bears will take over, that translates into a lower high.
So for now, we should stay above the 3830/20, if bulls can manage that, we should be able to reach the 4000ish. If this happens, we have to see how things go first, to be able to judge what the next step will be. Based on volume , maybe a bull flag or a triangle or whatever other pattern, we can judge things better. Open Intrest on bitmex, weakness/strength of alts also give decent indications. All these kind of tools should be used to be able to make a judgement call. Volume is the most important factor of all, because that is something that can't be hidden.
While i am finishing this, we just had a small dump to 3805, but the volume was low, so doesn't make real sense. Was just a wick, so could be noise. I showed my tick chart in my channel, where you can see it was Bitmex initiating it. When looking at ETH' (which usually shows the way), we don't see any weakness there yet. So for now, i assume it was just noise.
Don't forget to like if you appreciate this and want to support me :)
Previous analysis:
Anyway, past days i only posted a few updates on Bitcoin' in my free channels, where i said a potential double bottom might happen, since the 3810/820 zone was giving the bulls a hard time:
Starting to look like we might be headed for a double bottomish around 3700/3650. Depending on if we see at least a small bounce there or not.
A spike lower might happen, but only a spike! If we see a good bounce up, it could be the start of a continuation of the rally that started at 3400. If we don’t see a bounce, we have to start assuming bullish movement might be completely over for the coming weeks/months.
Yesterday i showed a potential smaller double bottom inside of the bigger one, almost identical to the one i showed a few weeks ago at the 3350/3400. The target of that small one was around 3770 which has been reached of course and at the moment we just broke the neckline of the bigger one around 3850. Just did a small break up while i am writing this, but no follow through yet though. Normally we should stay above the 3830 now so we can go towards the target of the W bottom around 3950/4000. If we break 3830/20, the attempt could fail, but so far volume looks good and bulls are holding their levels.
Bigger picture:
That "fractal" i showed a while back (yellow circles on the right) have been playing out so far. That blue line from my post of a few weeks ago might get completed now. A lot will depend on if the bulls can increase volume and break the 4000ish zone. If that happens, we could see another attempt at the 4200ish zone. If that happens, we have some kind of inverse H&S , with a big neckline around 4200. Also that higher low pattern, which remains unconfirmed below the 4200.
But confidence and volume is very important. I think we are at an important stage now, because if we can break the 4200, there will be chances for 5K+ prices. However, as you know from Part 1 of this analysis, we need to see a break of the 4600 zone. I think that is the key level between just a simply correction of the Bear trend, or that we see a much bigger correction, or possible even a trend change. I am personally not seeing a long term trend change, simply because volumes are too low in general. There is just not enough money in the crypto market.
My theory now is, a lot of people have a hedge running from the 4400/4600 zone (meaning they shorted there in Nov/Dec to protect their Dollar' value of Bitcoin ). So a break of this zone, will make all these people buy back their hedge position, fueling another push up. Probably in combo with the markets FOMO, we could see 5K+ prices.
Short term: The movement of the past week, can still all be just a correction of that big dump. Meaning, we can easily make a lower high in the 3850/4000 zone. That's why volume is so important at this stage. Because dropping volume simply means there are not enough buyers and they will loose the fight and bears will take over, that translates into a lower high.
So for now, we should stay above the 3830/20, if bulls can manage that, we should be able to reach the 4000ish. If this happens, we have to see how things go first, to be able to judge what the next step will be. Based on volume , maybe a bull flag or a triangle or whatever other pattern, we can judge things better. Open Intrest on bitmex, weakness/strength of alts also give decent indications. All these kind of tools should be used to be able to make a judgement call. Volume is the most important factor of all, because that is something that can't be hidden.
While i am finishing this, we just had a small dump to 3805, but the volume was low, so doesn't make real sense. Was just a wick, so could be noise. I showed my tick chart in my channel, where you can see it was Bitmex initiating it. When looking at ETH' (which usually shows the way), we don't see any weakness there yet. So for now, i assume it was just noise.
Don't forget to like if you appreciate this and want to support me :)
Previous analysis:
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Before i forget, knowing how this market works we have to be aware of one thing. We have seen moves like this many times before past 8 months or so. Breaking up after sideways action. Having a big daily candle, which would result in a big buy signal. However, seen it getting dumped up to an hour before the daily close, removing the clear buy signal. Just something to be aware of. Because a close above 3850 with decent volume, is usually a big buy signal. Making it usually 95% sure to see at least some follow through, at least half size of that candleЗаметка
New Litecoin analysis:
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I don't expect it to happen, but just in case, if we see the daily close above that red resistance zone on the right, so above 3950, it would be 90% sure to see at least 4100 and most likely even 4200. When touching 4200, i don't think bulls will give up anymore. But it has to happen before the weekend though, because last time, they did that strategic dump in the weekend, when order books are empty. On the left we can see a possible triangle. At the moment it's almost 50/50. Bulls are holding back, not really following through. So if that triangle breaks on the low side, we could see support around 3820, but a drop to 3800 is more likely. We should not see the 3770/80 break. I won't like that at all, might even turn slightly bearish if it happens.
ETH does look much stronger than BTC, lately it has been showing the short term direction often. So i would keep an eye on that one as well.
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New ETH analysis:
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At that support, but no bounce yet, suggesting it might brake any second and moving towards the next support zone. The dropping OI at mex since yesterday and the past hours, is bugging me a bit. Not really confirming this bullish move up. Yesterday i mentioned in my free channel that it looked like accumulation at the lows yesterday, but a 40mil drop of OI is not small. It is just a 150/200 point move so far, so not that meaningful. But really want to see OI increase, if we do move up to 3900/4000 zone. Заметка
Starting to look like we are moving in a similar way as 2 weeks ago. Showing similar pattern again. This would mean, we have to stay above the 3810ishЗаметка
Bulls are making an attempt already to break up, volume is increasing a bit, but still on the low side, making a Bart possible. So ideally we don't see a short squeeze, but simply see continues buying. So the order book doesn't get empty making a push down easy again, like what happened 2 days ago, when i showed that volume picture on the 1m in my channelЗаметка
Some big aggressive buying on Bitmex past half hour, so again an attempt. The bears are not giving up though, still big sells there, but this could be it. Bull need to keep the pressure now, keep it above 3860/55Заметка
Unless we see slow stable dropping of the price, i think i should give a small warning. I have been looking into some things, of this current bull flag. First thought was, it's a fake flag and it will probably drop again. However, this rally was not a short squeeze. Which is a very important difference. With each drop the past days, we see it getting bought up again, i just find i hard to tell if it's accumulation or distribution. If we continue to drop in a slow pace coming day or two, than i think we will break up eventually. So this channel you can see, is probably a good guideline to use. If we continue to move inside of, it should be seen as bullish. It's just ETH, that is weaker that other rallies past 3 months. There we can see a possible H&S even, but not confirmed yet. If we see drops there, but also small ones, moving inside that possible wedge, that could also be seen as bullish.
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Movements have been a bit confusing past past day or so. Bitcoin keeps pushing (after it broke that channel), but alts are not following. A bit weak even. For ETH, seems its better to watch that curved line from now on. Probably a good indication now for the short term
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Likely, that we are in the one on the left (more similar) or the one on the right from 10 days ago. Just comparing, but these moves suck, because they are always mean, to both sides!Заметка
So when seeing a move below 3850/40, than most likely to have the one from the left.Заметка
New Bitcoin short term analysis:
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