XBTUSD H1 chart (7/29/2019)

29 июл. 2019 г.

Good morning, traders. Things got interesting near yesterday's close with price dropping and then rocketing back up. This was a very strong reaction out of demand at $9100 following a low volume sell off. As a matter of fact, that pop up had the largest M30 volume that we have seen since July 18th and the swing low nearly found the July 17th swing low. This led to a large, $650 spread long-legged doji printing on the H4 and a slightly larger-bodied doji on the D1.

Normally, in such a case, we would expect price to ultimately continue higher. With price finding support at the M15 pivot this morning, this is what we are going to watch for now but we have to keep in mind that we are still seeing decreasing daily volume. Until we see expanding daily volume coupled with expanding candle spread, there is no guarantee of either direction.

In printing this swing low yesterday, price has potentially set up an Adam and Eve double bottom. A close above the swing high of $11132 would confirm this and set up a target of $13180 based on the height of the double bottom. The W1 printed tweezer bottoms which generally leads to a reversal to the upside, however H4 and H6 RSI haven't yet closed above their descending resistances yet. As I have been mentioning since last week, these are the main indicators I am watching for confirmation of a possible reversal to the upside.

The D3 is still printing that hidden bullish divergence that we've been watching for a while now, so it has not been confirmed yet. But we also have the W1 printing hidden bullish divergence as well, and if this week closes higher, then we could see the confirmation on both TFs. Why might this week close higher in spite of all the bearishness running rampant on CT, TV, and YT? The FOMC is expected to lower interest rates this week. That will weaken the dollar and, as a result, anything valued against the dollar (all things held equal) should see a rise in that value.

But first things first, price needs to close above the H1/H4 pivot at $9775, and in order to do that it needs to close above the H1 21 EMA which it is currently banging against. This will pull the H1 and H4 RSI's above their resistance which should indicate continued demand pressure. I have noted a few diagonal support and resistance levels to watch. If price makes it through the grey demand zone then I will first be looking for it to bounce off the S1 pivot just below $8860. Beyond that, I will watch for a bounce off the descending red support line. So nothing has really changed from last week. All this short term movement between $9100 and $10300 remains noise.

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