I was watching the action in the crypto markets last night and would like to share some interesting data I got. If you look at the chart below of ETH, you will see that there is a double bottom occurring where even on the one hour chart it just lightly touched the line perfectly.
4 Hour Chart: ETH
When you look at the chart you can see that ETH has just touched that prior low set nearly a week ago.
1 Hour Chart: ETH
Looking at the 1 Hour chart on Ethereum 3 hours later you can see that double bottom occurred and then hardly reversed and took out the prior low before reversing. This has happened countless times throughout the week that I have been following these price movements and it seems that on this current downward move this is how double bottoms have been tested. I would be weary to play double bottoms as reversal patterns and wait to see a better sign of a reversal as I stated earlier that the cryptos don't seem to follow this rule very well. And if you did play this move you would have placed your stop below this point and it would have been taken out.
I see one more move to the downside today before a possible reversal as I believe we will see a bounce off the major trend line and one more impulse move downward taking out the prior lows before seeing more upside. If I am wrong and this is the end of the downward move wait to see a breakout of the major trend lines or a strong consolidation pattern and play the breakout.
As always have a great day and a better one trading.