I mostly trade alts, but alts are heavily influenced by whatever bitcoin is doing. So I always keep an eye on BTC to gauge the general market.
In this case, I think a clear inversed head and shoulder pattern is forming, which is a strong reversal signal if the neckline is broken. Coincidentally, if BTC happens to break through the neckline, it might also simultaneosuly break the important purple trendline. These two singals together would confirm that BTC is breaking out of the bearish channel and is forming a new bullish trend. In that case, the first major target will be around 17.500 USD. With a strong BTC move, I believe many alts will suffer. Hence, I closed some of my alt positions and will not enter any new trades, before there is confirmation of where BTC is moving.
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BTC made a nice move upwards towards the neckline of the inverted H&S. However, it did not break this line, which has to be accompanied by an increase in volume, which is clearly lacking for bitcoin at the moment. Hence, we see price moving down again.
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This gree area is important, for now it looks like we are respecting it but if it breaks the level of the previous low, we might go further down towards the black trendline.
You published this a bit late. Unfortunately it rejected the downtrend resistance again :-(
heiders
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@CryptoXpertUK, you are probably looking at a linear scale. The trendline on that chart was rejected indeed. But for me the log chart is always leading, and price has not tested this line yet. So we will see.
CryptoXpertCX
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@heiders, ah yes, you’re right. So in general you think horizontal support and resistance is respected more than ascending or descending? Can you expand on what you mean when you say “linear scale” and “log chart”?
Thanks :-)
heiders
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No I did not say anything about horizontal vs. ascending/descending. I only mentioned the difference between log or linear charts. On a log chart the distance between 1-10 is the same as the distance between 10-100 and so on. Which makes more sense to me on a longer timeframe and with these major price fluctuations we see in crypto.