Hi everyone!
Down she goes once again!
Btc has now reached our targeted support area that we outlined in case of another leg down.
My previous update has to be corrected in so far that Btc wasn't forming a bear flag but rather a pennant. Both patterns are continuation patterns nevertheless; I drew the pennant on the chart so you can check for yourselves:
(Source: https://www.tradingview.com/x/DUD8c2ab/)
Now the question is: will we stop dumping here and start a retracement to the upside?
On the daily chart we now got 4 big red candles in a row, making this downwards movement from $7400 to $6200 feel exactly like the last one from $8500 to $6000 which also happened in pretty much one single downfall.
That's why we might be set up for even more downwards price action.
In case this support doesn't hold, this is the trendline I'm watching out for:
(Source: https://www.tradingview.com/x/44OVXOP8/)
However our indicators are showing good signs for the bulls on the short to medium term.
RSI and MACD are giving us clear bullish divergences on higher time frames and the MACD lines are getting another chance for a bullish crossover aswell.
(Source: https://www.tradingview.com/x/cv90jiqB/)
If price reverses here the daily chart would form a higher low after forming a lower high.
That's why I would expect Bitcoin to maybe get trapped in an Equilibrium for a while.
An Equilibrium is where price doesn't follow a specific trend, but rather forms higher lows and lower highs consecutively. Hence price is effectively going sideways.
But that has yet to be seen, only time will tell.
Optimistic bulls will start entering long positions here, while some bears may be betting on breaking the $6000 support on this attempt.
Again price action on the daily chart is not showing any strong signs for a bounce so a retest of the yearly bottom must be taken into consideration until we get some serious bullish confirmation of a reversal.
Until then, stay safe and healthy!
Medium: https://medium.com/@xenerion1/bitcoin-update-09-09-2018-8c83172c5f0a
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