Bitcoin's BiG Crown Reversal?: Preparations For Possible Extreme
Updated
We had intense institutional accumulation at the major key fibo support level a few weeks ago to stop the bloodletting just below $3000. This initiated an automatic rally, akin to the one we saw at the beginning of the month coming down from the ATH close to $5000, which stopped around $3900. Both rallies witnessed increasing volume while the trend reversed, indicated strong accumulation. The first accumulation failed, so the probability is high the second could fail as well. As a result, it would be wise to prepare for possible price action to go lower.
More specifically, we breached the major key fibo level (sitting above $3000), raising the odds we will test that level again, rather than attempt to form new all time highs. If we get another selling wave, we could test another major key fibo level formed by the March 2017 low (approx. $2450) but also the major key fibo formed in 2015 (approx. $2000). If we go down there, this will move us closer toward validating a big crown reversal.
To validate this big crown reversal, however, we need to see a breakdown below:
- The major fibo support (purple)/ key fibo support (red) between $3800 and $3600
- The current wedge (thick green lines) at approx. $3500
- The uptrend line (price will depend on the date of arrival)
- The major key fibo support (red) around $3000
- The trading range support around $2700
- The major uptrend line (price will depend on the date of arrival)
- The major key fibo support (red) around $2450
- and, finally, the trading range support around $2200
Alternatively, we could also prepare for a bounce from the major uptrend line noted by the MAX TP short on the chart. There is also a smaller possibility of bouncing from the nearer uptrend line.
PLEASE NOTE***: We could see a reversal at any point from here (at the time of writing, $3900) to continue the raging bull market. There are also plenty of opportunities to go "short-term" long using a counter-cyclical method while we decline to the major key fibos noted on the chart. Be sure to use confirmation lines and be on the lookout for bullish divergence in the RSI in the 15MIN, 1HR, and 4HR.
IMPLICATIONS FOR ALT-COINS: Price action in the BTCUSD chart has significant influence in other pairs against the USD and BTC. With closer confirmation of a big crown reversal in the BTCUSD chart, there are likely to be heavy losses in the entire crypto market.
Questions are more than welcomed!
Regards from Canada ;)
More specifically, we breached the major key fibo level (sitting above $3000), raising the odds we will test that level again, rather than attempt to form new all time highs. If we get another selling wave, we could test another major key fibo level formed by the March 2017 low (approx. $2450) but also the major key fibo formed in 2015 (approx. $2000). If we go down there, this will move us closer toward validating a big crown reversal.
To validate this big crown reversal, however, we need to see a breakdown below:
- The major fibo support (purple)/ key fibo support (red) between $3800 and $3600
- The current wedge (thick green lines) at approx. $3500
- The uptrend line (price will depend on the date of arrival)
- The major key fibo support (red) around $3000
- The trading range support around $2700
- The major uptrend line (price will depend on the date of arrival)
- The major key fibo support (red) around $2450
- and, finally, the trading range support around $2200
Alternatively, we could also prepare for a bounce from the major uptrend line noted by the MAX TP short on the chart. There is also a smaller possibility of bouncing from the nearer uptrend line.
PLEASE NOTE***: We could see a reversal at any point from here (at the time of writing, $3900) to continue the raging bull market. There are also plenty of opportunities to go "short-term" long using a counter-cyclical method while we decline to the major key fibos noted on the chart. Be sure to use confirmation lines and be on the lookout for bullish divergence in the RSI in the 15MIN, 1HR, and 4HR.
IMPLICATIONS FOR ALT-COINS: Price action in the BTCUSD chart has significant influence in other pairs against the USD and BTC. With closer confirmation of a big crown reversal in the BTCUSD chart, there are likely to be heavy losses in the entire crypto market.
Questions are more than welcomed!
Regards from Canada ;)
Note
upward break + confirmation Note
Shorting box is too strong at the moment:Note
Trading view deleted my saved charts again, so I had the opportunity to redo them. Here is a 4HR shot of the big crown reversal:First, notice I have moved the "possible sub-right crown" lines due to recent price action. As long as we are trading below $4696 a sub-crown reversal is still in play. If this crown becomes invalidated then the entire big crown reversal does as well.
Above you will find both short and long boxes (red and green rectangles), buy or sell confirmation lines (light blue faded lines), and the fibo lines on the chart. Keep in mind the long and short boxes further to the right are estimates and they will only becomes clearer once we bottom somewhere on the next leg down.
Also, the chart remains messy so I apologize in advance. This is the only way for me to get all the important points down for your viewing.
For today, here is where we are:
The short box is still strong.
Note
Note
Break above the rising wedge :) This is a nice place to short the market. If it keeps going up, you rejoin the action a little higher, that is, if you are small scale. If you are big scale, the big push will be breaking above the ATH. For now, we wait for shorting opportunities.Note
RSI looks a little tired now and we are back in the wedge. The situation remains unclear. Levels to watch to the upside are $4402 and $4697. Levels to watch to the downside from here are $3859 (sub-fibo support) and $3532 (sub-key fibo support). A bounce from the former could bring more upward movement so be careful entering any leveraged trades.Note
I just love this pattern :) do I have confirmation bias?Note
We nearly kissed the sub-left crown high at $4496 (the dashed faded purple line). This is a normal level to reach in a crown reversal. We can spot a rising wedge extension as well. The higher it goes, the farther it falls.Note
Here we go:Note
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