Bitcoin is due for a pullback!
Hello Everyone,
Unpopular opinion but I believe Bitcoin is due for a pullback. Where? I would estimate around $43,000 to as low as $42,000. On the chart above, I have listed 3 scenarios for bitcoin. I believe scenario 2 will be the most likely as price action, RSI, current pattern, and MACD are all short term bearish.
Let's go through the scenarios:
Blue Scenario: This scenario is a healthy bullish pullback in which bitcoin has broken down from the Ascending wedge (bearish pattern) and will retest common upward trend support. This could easily keep this market going but I believe a larger pullback is more likely.
Red Scenario: This is what I believe will be the most likely scenario. A healthy bullish pullback with a bearish fakeout. This will completely destroy the bearish outlook and liquidate short positions. It will allow for a healthier bull market to continue and it finally retests major support at $42,000.
White Scenario: This is the scenario no bull wants to see. The bearish scenario. Yes, this is likely, however I do think it is the least likely of all the scenarios. However, as traders utilizing risk management, we need to take a look at this. This scenario breaks the bullish support of $42,000 and creates a head and shoulders (bearish pattern) for bitcoin. If this is validated, I believe it confirm that this 60% move up from, $32,000 to $48,000 was just an over extended relief rally.
Why do I believe there will be a pullback? Here are the technicals:
1. Price Action is bearish: We can clearly see price going up as volume is going down which is very bearish.
2. RSI breakdown and retest
3. Ascending wedge (typically a bearish pattern) breakdown.
4. MACD flipping bearish on the 12 hour and showing buying weakness on the daily.
5. Bitcoin just saw 60% increase with no pullback or consolidation.
I hope you enjoyed my analysis. I am bullish overall until $42,000 is broken but I truly believe bitcoin and alts will pullback for the reasons above.
As always, be patient, use risk management, and good luck trading.
Unpopular opinion but I believe Bitcoin is due for a pullback. Where? I would estimate around $43,000 to as low as $42,000. On the chart above, I have listed 3 scenarios for bitcoin. I believe scenario 2 will be the most likely as price action, RSI, current pattern, and MACD are all short term bearish.
Let's go through the scenarios:
Blue Scenario: This scenario is a healthy bullish pullback in which bitcoin has broken down from the Ascending wedge (bearish pattern) and will retest common upward trend support. This could easily keep this market going but I believe a larger pullback is more likely.
Red Scenario: This is what I believe will be the most likely scenario. A healthy bullish pullback with a bearish fakeout. This will completely destroy the bearish outlook and liquidate short positions. It will allow for a healthier bull market to continue and it finally retests major support at $42,000.
White Scenario: This is the scenario no bull wants to see. The bearish scenario. Yes, this is likely, however I do think it is the least likely of all the scenarios. However, as traders utilizing risk management, we need to take a look at this. This scenario breaks the bullish support of $42,000 and creates a head and shoulders (bearish pattern) for bitcoin. If this is validated, I believe it confirm that this 60% move up from, $32,000 to $48,000 was just an over extended relief rally.
Why do I believe there will be a pullback? Here are the technicals:
1. Price Action is bearish: We can clearly see price going up as volume is going down which is very bearish.
2. RSI breakdown and retest
3. Ascending wedge (typically a bearish pattern) breakdown.
4. MACD flipping bearish on the 12 hour and showing buying weakness on the daily.
5. Bitcoin just saw 60% increase with no pullback or consolidation.
I hope you enjoyed my analysis. I am bullish overall until $42,000 is broken but I truly believe bitcoin and alts will pullback for the reasons above.
As always, be patient, use risk management, and good luck trading.
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