Bitcoin (BTC) update - More consolidation? - Technical Analysis January 26th
Hey guys!
Not much has changed since yesterday when I gave my analysis, but I thought I'd touch on what I'm doing during these times, where people don't really know where the frig BTC is going to go. I have scenarios noted so if we hit a price lower than I expected, I have a contingency strategy ready to go. This means that if I'm a little off with my analysis, I can quickly react, manage the current price action and make a smart trading decision based on the new data I have.*
*QUICK TRADING TIP - Trading is reactive guys, remember that. Plan the trade, and trade the plan. You will have to react fast on occasions. Inaction can get you rekt! Over-reaction can also get you rekt! We need a balance of risk:reward. If I don't think it's worth it for the risk, I don't make the trade. I don't care if it goes 2x a day later, I stick to my guns, don't get emotional (which is a breeze for a cold hearted analyst like me hehe) and I trade WITH the trend, not AGAINST it.
Anyway, back to BTC.
As you can see, we've seen resistance on the trend line I have on the chart above the price action. I have also got 2 trend lines under the price action.
I see 3 options here for BTC:
We head for the trend line that is creating a slight falling wedge pattern. The third touch would confirm that as support, so I'd be more confident trading BTC here.
We form a double bottom between $9900 and $10100 and create the B corrective wave. This could well happen, but BTC seems to be getting support around the lower trend line that's going up from left to right, so we could well bounce before heading for the lower trend line support.
We form a symetrical triangle formation, squeezing the price to the edge of the triangle before a breakout. Also possible, we'll just have to see over the next day or two.
So there you have it folks, 3 scenarios that I've looked at. I think the bottom is near, and that's why I'm not looking at anymore bearish scenarios of $5k etc. haha.
Use this analysis to react. Remember, plan the trade, and trade the plan.
Peace.
- B