Bitcoin Ultimatum - It Must Breakout Or It Will Surely Breakdown
Hello Traders, Here is my analysis for Bitcoin.
Let me start by saying that BTC is in a very precarious position. Heres why...
1) It's just barely above major support at 17.6K - If (most likely when) it breaks, there is no doubt that we will see massive capitulation. Potentially seeing a double digit % move down the day it breaks.
2) The descending trendline connecting the November highs to now will act as major resistance.
- BTC needs to break this trendline to have any hopes of a large rally anytime soon.
The reason that this puts Bitcoin in a precarious position is because it is trading in a larger wedge where both the descending trendline and 17.6K major support will soon converge.
*There can only be one of two outcomes in this situation:
1) Either we breakout
2) Or we breakdown
What do I think will happen?
- First off, I think regardless of whether we breakout or breakdown, BTC has not bottomed and will hit at a minimum
12K, but probably more like 8K.
- I think we could see a short term rally this week, potentially taking BTC up to the trendline to test it.
- Given the strong Bearish climate and weaker relative strength in BTC, I think it's unlikely that BTC breaks out of the trendline and will most likely get rejected from it.
What happens if BTC breaks the trendline? Won't that be Bullish?
- Yes, it would be bullish but for the short term.
- BTC would likely rally after breaking the trendline, probably back up to about 24K.
- But being as we're in a bear market, eventually the bears would take back control of BTC and short it into oblivion, back below support at 17.6K and lower.
***If BTC breaks out of the trendline, don't get fooled into thinking that the Bear market is over and BTC has put in a bottom. Smart money will be looking to trap traders in a scenario like this.
Why is this important?
- Essentially, no matter what, I'm bearish on BTC.
- This means that I believe there is a very high probability that ultimately BTC will trend much much lower.
- I'm preparing my shorts, I'm planning my trades, and I'm looking for the ideal entry for a short position which I will ride out below the 17.6K support.
Be Beary cautious in this type of market environment!
Thats it for this BTC post, thanks everyone and best of luck trading!
Let me start by saying that BTC is in a very precarious position. Heres why...
1) It's just barely above major support at 17.6K - If (most likely when) it breaks, there is no doubt that we will see massive capitulation. Potentially seeing a double digit % move down the day it breaks.
2) The descending trendline connecting the November highs to now will act as major resistance.
- BTC needs to break this trendline to have any hopes of a large rally anytime soon.
The reason that this puts Bitcoin in a precarious position is because it is trading in a larger wedge where both the descending trendline and 17.6K major support will soon converge.
*There can only be one of two outcomes in this situation:
1) Either we breakout
2) Or we breakdown
What do I think will happen?
- First off, I think regardless of whether we breakout or breakdown, BTC has not bottomed and will hit at a minimum
12K, but probably more like 8K.- I think we could see a short term rally this week, potentially taking BTC up to the trendline to test it.
- Given the strong Bearish climate and weaker relative strength in BTC, I think it's unlikely that BTC breaks out of the trendline and will most likely get rejected from it.
What happens if BTC breaks the trendline? Won't that be Bullish?
- Yes, it would be bullish but for the short term.
- BTC would likely rally after breaking the trendline, probably back up to about 24K.
- But being as we're in a bear market, eventually the bears would take back control of BTC and short it into oblivion, back below support at 17.6K and lower.
***If BTC breaks out of the trendline, don't get fooled into thinking that the Bear market is over and BTC has put in a bottom. Smart money will be looking to trap traders in a scenario like this.
Why is this important?
- Essentially, no matter what, I'm bearish on BTC.
- This means that I believe there is a very high probability that ultimately BTC will trend much much lower.
- I'm preparing my shorts, I'm planning my trades, and I'm looking for the ideal entry for a short position which I will ride out below the 17.6K support.
Be Beary cautious in this type of market environment!
Thats it for this BTC post, thanks everyone and best of luck trading!
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