$6k next. Does the buck stop there or is this terminal shakeout?
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Bitcoin has strong RSI bullish divergence on the 4H chart. RSI was at its lowest extended level since January 2015 on the daily and is still currently oversold on all time frames up to the 1D chart. MACD is looking bullish and expecting a cross to the upside.
There should be a move up to the 6k resistance at 0.618 fib which has been a behemouth support level all year. The question is, does this act as the strong resistance which the herd is expecting or is this a terminal shakeout taking place instead which occurs at the end of a period of accumulation and is intended to shakeout weak hands before a powerful move up? Could this not be the case considering we have been trading within a tight range for a couple months now.
Don't fall prey to smart money and short at these levels unless the 6k behemouth is too strong as resistance and unless we don't have the volume behind the move in which case we can expect a drop back to $5500 or potentially 5k. Even if price breaks above 6k, we still need a close above $6250 at 0.718 fib, which has been significant these past couple months, in order for there to be a sustained move back to the $6500 iron curtain and hopefully a close above it.
Good luck and happy trading!
There should be a move up to the 6k resistance at 0.618 fib which has been a behemouth support level all year. The question is, does this act as the strong resistance which the herd is expecting or is this a terminal shakeout taking place instead which occurs at the end of a period of accumulation and is intended to shakeout weak hands before a powerful move up? Could this not be the case considering we have been trading within a tight range for a couple months now.
Don't fall prey to smart money and short at these levels unless the 6k behemouth is too strong as resistance and unless we don't have the volume behind the move in which case we can expect a drop back to $5500 or potentially 5k. Even if price breaks above 6k, we still need a close above $6250 at 0.718 fib, which has been significant these past couple months, in order for there to be a sustained move back to the $6500 iron curtain and hopefully a close above it.
Good luck and happy trading!
Note
This previous chart is the larger picture which explains the trend lines.
Note
Have a look at the bigger picture. Still quite clearly forming a falling wedge on the monthly chart which means the market has definitely not chosen its direction yet for 2019. According to this formation, the market will more than likely have a decision for us before the end of next month. This is bullish pattern though and has a higher probability of playing out on a higher time frame.For the short term, price can definitely move lower, however it will have strong support at the bottom of the wedge around 5k followed by the strong $4740 horizontal monthly support just below that so I see a drop to 5k or potentially $4740 in the short term. A break below this is going to be my confirmation of an extended bear market so I'll be trying to block out as much of the short term noise as possible until then.
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