Divergence shown and momentum waning for the Bitcoin bulls.
Divergences alone are not a predictor of future movements however
in combination with the greater context we can have somewhat of an idea
of what the high probability moves will be. Sometimes after an impulse move we can have
a divergence in momentum or RSI in which case it represents a cooling off
before the next impulse upward. However, in the case of Bitcoin, divergences
from the 15 minute to the higher time frames have typically preceded
movements in the opposite direction about 70% of the time. Here we can see
what looks to be a bearish divergence and a flattening of the OBV as we
move upward. I would expect in the near future that we retrace somewhere
between 6450-6600. Of course it is possible that we continue to move upward
but the resistance around the 55 EMA should be pretty strong.
Right now I am neutral and all cash until we confirm a breakout and retest
of the 55 EMA.
in combination with the greater context we can have somewhat of an idea
of what the high probability moves will be. Sometimes after an impulse move we can have
a divergence in momentum or RSI in which case it represents a cooling off
before the next impulse upward. However, in the case of Bitcoin, divergences
from the 15 minute to the higher time frames have typically preceded
movements in the opposite direction about 70% of the time. Here we can see
what looks to be a bearish divergence and a flattening of the OBV as we
move upward. I would expect in the near future that we retrace somewhere
between 6450-6600. Of course it is possible that we continue to move upward
but the resistance around the 55 EMA should be pretty strong.
Right now I am neutral and all cash until we confirm a breakout and retest
of the 55 EMA.