If you recall from my last post, I was covering the that BTC was creating. As you can see, a breakdown from the did occur, but price rallied hard after the breakdown, as a wave of buyers rushed into the market, probably trying to catch the , and also because BTC was oversold. However, I wouldn't get too excited about the rally. In my view, it's just another pop before the big drop. Looking at the chart, you can see that BTC is right at the 50 (in orange.) Now, I'm not just saying that I don't buy this rally for nothing. Here is the technical reason why I don't think there is much wind in the bulls' sails.
I want to draw your attention to the first blue arrow. If you look at the price action before that low was formed, you can see that there was a , that broke down to for the sharp low, and then price quickly rallied higher, forming somewhat of a small sloppy inverted pattern in the process. From there, it rallied just above the 50 , where it ran out of gas, and inevitably rolled back over to the downside. Looking at the current action, it looks almost identical. You can see that we formed a , which broke down to produce a sharp low (blue arrow) and then we have quickly reversed back to the upside. Now, price has run into the 50 , where it's beginning to find some resistance. So, just like the outcome of the rally off of the first blue arrow, I'm expecting a failure in this rally, in the very near future. In my opinion, this is a selling opportunity, and nothing more.
On the , you can see that there was a crossover, that produced some momentum expansion to the upside, but the has been on a steady decline during this entire rally off of the low. I still see broad weakness in BTC and the rest of the crypto space. A small bounce doesn't change that. Remember, the markets don't generally move in a straight line. Fluctuations can occur, but the important thing is that we remain on the right side of the market. Right now, this is an overwhelmingly strong bear market, that is experiencing a small bounce. The trend is your friend. Know that, own it, and you will avoid disaster. With that said, the overall trend is down, down, down, and it is highly likely to remain that way. I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! revoir! ;)
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-Magic loves you-
Previous waves resistance = new waves support. BTC is going to bottom out between $2500-$3000. How strong the movement down is indicative of the price. Keep your cash in USD and off the market unless you can successfully day trade without coming here. We'll probably bottom out within the next 2 weeks.
Don't listen to either of us.