XBT/USD TECHNICAL ANALYSIS. SHORT TERM BEARISH SCENARIO
Aggiornato
Hello everyone, welcome to my short term perspective of bitcoin on bitmex.
Let's get right to it.I would like to start with the price action and then I will move on to the indicators.
We have a rising wedge formation, which appears to have completed and broken down on 6/3 at 2000 hours. Keep this time in mind , I will refer to it once again later on.
This rising wedge began forming after a bounce off of $7060 ( Strong support zone shown in pink). Price then rose to the .618 retracement( $7766 ) ,
completed the pattern formation, then ultimately broke down. Price also ran into the 100 EMA, and got rejected as well.(red arrow)
I would like you to take a look at the blue arrow. In the recent past(5/20-5/21), price also ran into the 100 EMA, got rejected, and ultimately broke down.
Price is currently testing the $7500 price level. Keep in mind that this is a STRONG psychological support level. Such as any other multiple of 500 or 1000.
Price will stay in this area for a while until either bears or bulls win the battle and take over.
The same sellers that were present during the first breakdown (5/21) could come back now and
drop the price again. It's clear that selloff has already begun, but how strong are these sellers? We don't know yet.
In the most bearish scenario, price can go as low as $6950. I would not be alarmed if price went this low.
Now I would like to move on to the indicators. Starting with the MACD. You'll notice the moving averages are not there.
I have removed them for visual purposes(side note: there is a bearish cross on the two ma's, not shown in my chart)
The MACD histagram began showing DIVERGENCE prior to the breakdown of the rising wedge pattern.
This means that the histagram provided the first indication that price may be on its way down in the near future.
Now I'd like to bring up the time of the original WEDGE pattern breakdown,
2000 hours on 6/3.(8PM if you dont know military time)
The MACD histagram curled downward unitl 2000 on 6/3, prior to breaking down under the neutral line( " 0 line). And price broke down with it.
Now I'd like you to have a look at the RSI. A similar rising wedge pattern occured on the rsi as well. It begain rising with the price action until it
tested resistance. It ultimately broke down at 2000 on 6/3 along with the price.
It's clear that selloff has already begun, but how strong are these sellers? We don't know yet.
I have highlighted the bearish and bullish scenarios. I hope this helps you improve your perspective and due diligence.
Please note that this is only a short term perspective. IF I am WRONG, and price bounces off $7500 and breaks above the .618 retracement, then awesome !
I will close my short position and go long. There is no problem with that.
I am still long term bullish on bitcoin, but I do believe that we are facing a short term
breakdown. Thank you for reading.
-
** LEGAL BS: I am NOT a financial advisor. This is not FINANCIAL ADVICE or reccommendation to buy/sell BTC. This information is for educative purposes .**
Let's get right to it.I would like to start with the price action and then I will move on to the indicators.
We have a rising wedge formation, which appears to have completed and broken down on 6/3 at 2000 hours. Keep this time in mind , I will refer to it once again later on.
This rising wedge began forming after a bounce off of $7060 ( Strong support zone shown in pink). Price then rose to the .618 retracement( $7766 ) ,
completed the pattern formation, then ultimately broke down. Price also ran into the 100 EMA, and got rejected as well.(red arrow)
I would like you to take a look at the blue arrow. In the recent past(5/20-5/21), price also ran into the 100 EMA, got rejected, and ultimately broke down.
Price is currently testing the $7500 price level. Keep in mind that this is a STRONG psychological support level. Such as any other multiple of 500 or 1000.
Price will stay in this area for a while until either bears or bulls win the battle and take over.
The same sellers that were present during the first breakdown (5/21) could come back now and
drop the price again. It's clear that selloff has already begun, but how strong are these sellers? We don't know yet.
In the most bearish scenario, price can go as low as $6950. I would not be alarmed if price went this low.
Now I would like to move on to the indicators. Starting with the MACD. You'll notice the moving averages are not there.
I have removed them for visual purposes(side note: there is a bearish cross on the two ma's, not shown in my chart)
The MACD histagram began showing DIVERGENCE prior to the breakdown of the rising wedge pattern.
This means that the histagram provided the first indication that price may be on its way down in the near future.
Now I'd like to bring up the time of the original WEDGE pattern breakdown,
2000 hours on 6/3.(8PM if you dont know military time)
The MACD histagram curled downward unitl 2000 on 6/3, prior to breaking down under the neutral line( " 0 line). And price broke down with it.
Now I'd like you to have a look at the RSI. A similar rising wedge pattern occured on the rsi as well. It begain rising with the price action until it
tested resistance. It ultimately broke down at 2000 on 6/3 along with the price.
It's clear that selloff has already begun, but how strong are these sellers? We don't know yet.
I have highlighted the bearish and bullish scenarios. I hope this helps you improve your perspective and due diligence.
Please note that this is only a short term perspective. IF I am WRONG, and price bounces off $7500 and breaks above the .618 retracement, then awesome !
I will close my short position and go long. There is no problem with that.
I am still long term bullish on bitcoin, but I do believe that we are facing a short term
breakdown. Thank you for reading.
-
** LEGAL BS: I am NOT a financial advisor. This is not FINANCIAL ADVICE or reccommendation to buy/sell BTC. This information is for educative purposes .**
Nota
Update :On the date of my post, price dropped slightly for the remainder of the day. Then price rallied up for the next 2 days straight. Price attempted to reach the .618 retracement and failed in the 7700s. It rose to the highest point of 7755. I hope you did not brush off my idea when price went up for two days. I had mentioned the .618 retracemnt having to be surpassed before I switch to bullish for this exact reason. You can also see that price went as low as 7170, just shy of the .786 retrace. This does mark the end of the breakdown. It is possible to go further into the strong support zone,(I would not be alarmed if we did , you 'either) it is also possible to rally back to the 7700's and retry the .618 retrace. If you are still keeping up with my idea, then thank you for reading. :)
Trade chiuso: obiettivo raggiunto
You can see what happened today. It's safe to say this trade is closed. Btc has completely broken down. I hope this prevented some people chasing green candles in the 7600-7700 area. I will post a new analysis in about a week. Thank you
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