Sometimes, the simplest of ideas are the most effective
Welcome everyone!
Let´s get right to it: after a very massive support break at 6k, Bitcoin went in for a cliff dive that caused a lot of carnage. However, it finally seems that the long expected correction to the upside is ahead of us.
1.) We touched the 200 weekly MA: it is one of, if not THE most important MA´s in all of technical analysis. Also called "the trampoline", a further, substantial drop from this level is very unlikely without some sort of a relief rally
2.) Stoch RSI and RSI: in regards to Stoch RSI, if you take a look at the past year, Bitcoin has started a massive rally everytime the weekly stoch started trending upwards and it has already started trending upwards at the time of writing this. Weekly RSI is coming from oversold (which has happened only once in all of Bitcoin´s history) with a sharp turn to the upside.
3.) Daily RSI: massive bullish divergence, I think no further description is needed.
Go very long. Targets:
1.)4400
2.)5500
3.)Final target: 200 DAILY MA along with 6k support level
Time: short to mid - term
Does this mean we are out of the bear market?
Well, unfortunately no.
If you look at the weekly RSI, we are still only at the first leg of the bear market compared to 2014 (marked with green arrows) and since we have, so far, replicated almost every single move of the 2014 bear market, I dont see a reason why that would change in the future.
It is very likely we will get rejected by the 200 daily MA and (if we come to that) the 6k support level that held as support for the entire year (big support becomes big resistance). Once that happens, be prepared for the final leg of this bear market, a brutal sell off that could take us to 1.3k and even lower. We still haven´t seen true capitulation yet and until I see a big red candle with a 40% drop in a day or two and with the volume to back it up, I remain bearish.
Remember, trading is a marathon, if you came this far there is no point in quiting 5 km before the finish line, no matter how much it hurts.
Let´s get right to it: after a very massive support break at 6k, Bitcoin went in for a cliff dive that caused a lot of carnage. However, it finally seems that the long expected correction to the upside is ahead of us.
1.) We touched the 200 weekly MA: it is one of, if not THE most important MA´s in all of technical analysis. Also called "the trampoline", a further, substantial drop from this level is very unlikely without some sort of a relief rally
2.) Stoch RSI and RSI: in regards to Stoch RSI, if you take a look at the past year, Bitcoin has started a massive rally everytime the weekly stoch started trending upwards and it has already started trending upwards at the time of writing this. Weekly RSI is coming from oversold (which has happened only once in all of Bitcoin´s history) with a sharp turn to the upside.
3.) Daily RSI: massive bullish divergence, I think no further description is needed.
Go very long. Targets:
1.)4400
2.)5500
3.)Final target: 200 DAILY MA along with 6k support level
Time: short to mid - term
Does this mean we are out of the bear market?
Well, unfortunately no.
If you look at the weekly RSI, we are still only at the first leg of the bear market compared to 2014 (marked with green arrows) and since we have, so far, replicated almost every single move of the 2014 bear market, I dont see a reason why that would change in the future.
It is very likely we will get rejected by the 200 daily MA and (if we come to that) the 6k support level that held as support for the entire year (big support becomes big resistance). Once that happens, be prepared for the final leg of this bear market, a brutal sell off that could take us to 1.3k and even lower. We still haven´t seen true capitulation yet and until I see a big red candle with a 40% drop in a day or two and with the volume to back it up, I remain bearish.
Remember, trading is a marathon, if you came this far there is no point in quiting 5 km before the finish line, no matter how much it hurts.
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