The bitcoin bulls have been in form and have bought up the dip, pushing the price back up to just $2k short of the ATH. However, on the 1 hour we can see that price has rolled over and is sharply returning to the downside once more. In fact the velocity is increasing. All MA levels on the 1 hour chart are smashed in the last few hours.
This could just be a spike down or a wick, but it suggests that the bears are still in with a chance. What exciting times ladies and gentlemen. The race is on between the two sides of the price action.
On the 1 hour chart we can see how the RSI has entered oversold territory below 25 right now. In the 4 hour chart, we are just about to complete an almost 8% dip in one candle. The heat is on. We have support on the 4 hour chart at the 100 EMA at around $34600. This 100 EMA has acted as support in the last dip, the initial one from the ATH of $42k. If it holds, then it will make a higher low, although we have not seen a higher high yet. This is creating a symmetrical triangle, a consolidation pattern.
On the 4 hour chart, we see that the RSI is bearish, under 50 and we have more room to the downside. There is always a vague chance that we may take a week for example to consolidate before the next leg. However, whether that leg goes up or down remains to be seen. There is a case either way. Watch for a break of structure in the symmetrical triangle formation arising now. Price could well bounce off the 100 EMA on the 4 hour chart. If not then the next support down may be the bottom of the bollinger band which coincides with the previous low in the $30k to $32k area.
Let’s wait and see if the 100 EMA has a candle close below it. This will suggest a possible further dip. That said, this was invalidated at the last dip three days ago, where there was one candle on the 4 hour chart that closed below the 4 hour EMA, but price bounced quickly back up by the next candle. Nevertheless, the 4 hour has acted as strong support since the initial dip 3 days ago, more than once.
These are heady times for Bitcoin traders and enthusiasts, the bull rush always is in each 4 year cycle. The volatility is present and that’s where profits can be made. Just learn to read the indicators, and keep a focus on your plan and strategy. Make notes to yourself to remind yourself of the trades, the logic and the strategy you have set for yourself, both long term and in each style of trading.
Learn about your personality and which style of trading suits you personally. Are you a scalping trader, a swing trader, or a long term hodler? Or do you prefer the even more riskier leverage trading? Younger investors go for the more high risk style. I have tried it but need to sharpen by skills still more before I attempt anything too risky. With age I have grown more conservative, which is natural.
So trading can be a way of life and a career, if you master the art. Don’t be put off by occasional losses. Come back and keep improving, like learning to ride a horse or harness the dragon. You learn so much about your strengths and weaknesses mentally from trading. And you can practice at your own time, which is great for the new work from home lifestyle.
As I conclude this, the bitcoin price has just crashed with speed down to the support of the100 EMA that I was mentioning above. In fact it has gone below it, but bounced back up above. Is this the bounce back already? Let’s watch and see what plays out. Wishing you the best of health and happy trading.
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