After the Trading View mods decided to give me a nice long 1 month break (because they know they love me too much), I am back.
I am noticing a significant bearish divergence, with the addition of a bearish megaphone pattern. This pattern, I have been adjusting due to the wicks day by day due to the wicks and height of the upswings, but it is still very valid.
I am not a huge fan of volume (because it can be faked), but I am also noticing a decline in volume. While the the weekly candles are technically in a bullish posture, they are tightly compressed with tight volatility and higher lows. But the volume is on the decline which means this overall structure is set to break out. This is another bearish divergence.
With the entire market bullish, alt coins exploding 400% out of no where, this is highly reminiscent of the post dump rally/dead cat bounce of last year (after we fell from 11,800), where the market suffered hell candles for WEEKS.
IMO, we have not seen the bottom yet, and there is still no catalyst to initiate a big 40%+ rally to the upside, it makes a lot of sense for whales/exchanges to take profit at these levels. ETH, BTC, and LTC margin positions are still significantly high, but shorts are starting to scale in at this level.
I still believe this level is a good short zone, and targeting the bottom of the wedge, which also gives confluence with the 0.618 fib. But the truth is, that these patterns break down, and I am looking at the 3.4k level to take some profit. After that we will re-evaluate.
Commento
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BOOM mothafookas
Commento
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Currently laddering more shorts for the eventual hell candle down to the 3.4k level
Commento
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As you can see, the resistance has been too great and there is not enough volume to push the heavy resistance at the 3950-4000 level. The huge rejection (which was preceded by a fake out) was telling in the fact that big money wants this down. This is why I never understood those who said it was going back to 4100 or 4200. Why would a whale/hedge fund/market maker dump a load of bitcoin only to have it go back to the same price? This player is clearly waiting for at least 1000 points down to take profit. There is also no big buying after such move.
Retail is still bullish because they are looking at the wrong indicators and drawing the wrong patterns. They will soon learn once their stops get raided all the way to the mid 2k level. Reality will happen. It's only a question of when.
Commento
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As you can see we dropped to this critical support line which bulls have been holding, but there has been no signs of massive buying, just a protection of critical support levels. Volume on the bounces remains low, which suggests that a big dump will overpower the bullish defense.
A break of this blue dotted line should bring a rapid descent to the lower trend line of this symmetrical triangle which is the 3600 level on Bitfinex.