Bitcoin last night hit a critical level of resistance at $4480 which happens to be the right side of a crown on the daily charts. The next FIB abcd move down from the crown looks like its in play and we may see a re-test of the $4480 resistance level today. If it does re-test the $4480 it MUST close with a strong bullish candle to be confirmation of its next leg up to around the $6000. At this stage though I don't see that happening because the crown reversal pattern, structurally looks strong.
Just a explaination the rules for a crown reversal for those not familiar with it.
1. The inner up trend line is broken - which we saw happen on September 8 2017
2. The market returns to test a previous level of support which was the $2900 - $3000 level which happened on the September 15 2017
3. Find the B of up ABCD level which is $4480 which is the left tip of the crown reversal and also gives us an indication of where the right side of the crown will form. This is where we are now.
So once we get confirmation, which should be today - I expect the next abcd move which I have labeled on the chart to be down to $2500 - 2600USD which also happens to be a major outer trend line. I have also used purple arrows to show the anticipated move down.
Refer to my previous analysis' as validation of this method of analysis.
Just a explaination the rules for a crown reversal for those not familiar with it.
1. The inner up trend line is broken - which we saw happen on September 8 2017
2. The market returns to test a previous level of support which was the $2900 - $3000 level which happened on the September 15 2017
3. Find the B of up ABCD level which is $4480 which is the left tip of the crown reversal and also gives us an indication of where the right side of the crown will form. This is where we are now.
So once we get confirmation, which should be today - I expect the next abcd move which I have labeled on the chart to be down to $2500 - 2600USD which also happens to be a major outer trend line. I have also used purple arrows to show the anticipated move down.
Refer to my previous analysis' as validation of this method of analysis.
