One more leg down for Bitcoin
Updated
Further to my previous post titled "Further downside for Bitcoin expected" (link below), the bear flag pattern / ascending channel broken to the downside and reached our profit target. This also coincides with a 127% Fib extension.
So where to now?
Firstly, I will draw your attention to the shaded yellow area on the chart. This is a DEMAND zone in which price rocketed off back in the middle of July (scroll to the left). Price has just touched this zone and we would expect a similar outcome. However, we can see that the bounce off this zone was an absolute shocker. This tells us there is no longer any demand to buy Bitcoin.
It is my opinion that we are to see another push down before a rest and relief rally. The momentum has clearly shifted and we are in BEAR territory having also broken the neckline of the larger inverse head & shoulders pattern. We can see on the chart now that Bitcoin is forming another ascending channel and about to break down. It might consolidate a while longer in this channel but expecting a clean break to our profit target near $5,900 that is also a 1.618% Fib extension.
After this trade, I will be out of all short positions as the R/R is not favorable anymore, until the next clear pattern emerges.
Please give this trade idea a THUMBS UP and I will keep you updated!
Disclaimer: This is only my opinion, make of it what you wish. It is not financial advice.
So where to now?
Firstly, I will draw your attention to the shaded yellow area on the chart. This is a DEMAND zone in which price rocketed off back in the middle of July (scroll to the left). Price has just touched this zone and we would expect a similar outcome. However, we can see that the bounce off this zone was an absolute shocker. This tells us there is no longer any demand to buy Bitcoin.
It is my opinion that we are to see another push down before a rest and relief rally. The momentum has clearly shifted and we are in BEAR territory having also broken the neckline of the larger inverse head & shoulders pattern. We can see on the chart now that Bitcoin is forming another ascending channel and about to break down. It might consolidate a while longer in this channel but expecting a clean break to our profit target near $5,900 that is also a 1.618% Fib extension.
After this trade, I will be out of all short positions as the R/R is not favorable anymore, until the next clear pattern emerges.
Please give this trade idea a THUMBS UP and I will keep you updated!
Disclaimer: This is only my opinion, make of it what you wish. It is not financial advice.
Note
False break out of the channel to form a double bottom. Timing incorrect. Tally still weak. Remain bearish and will wait for another confirmation to short.Note
The demand zone which previously acted as support has finally been broken. Each rally is weaker and weaker .Note
Still on track to our target. Interestingly, there is a substantial Fib cluster at this level that should draw price to it.Note
Note
Bitcoin has finally reached the $5,900 area as expected. Congrats to those that held a short position.
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