No, it wasn't Elon Musk. Bitcoin was exhausted
Hello Everyone,
I've been seeing a lot of tweets and posts suggesting this drop and the few more to come are a result of Elon Musk's tweet about Tesla no longer accepting bitcoin. How can you blame one man's tweet, that even states "Tesla will not sell it's Bitcoin" for the drop in price? Here's the truth:
Bitcoin has been far over extended since the first move to $60,000 in the middle of March. On top of that, Bearish divergence has been building on MACD, RSI, and price action. Let's look at volume, as the price kept moving up, volume kept moving down. This is class A bearish price action. This drop was very obvious from the final move to $65,000 then the retest (right shoulder of the HS) of $60,000.
Elon Musk may have thrown a match into a pit of gasoline, but so many other factors were doing the same. This market needs to cool off to gain more investor interest to make higher highs. Bitcoin has finally tested its 20 weekly MA after 5 months of not being anywhere close.
Are we in a bear market? No, we are still far from a bear market. My guess is that we see a similar move to the chart on the right. There was a valid HS, Bitcoin dipped 10%, then it consolidated. After consolidation, it was moon time.
I imagine something similar will happen. This head and shoulders is to reset the market for another large move upwards.
I hope this helps clear the air. Price action, in my opinion, is the best way to indicate the health of a market move. Exhaustion was inevitable.
As always, be patient, have risk management, and good luck trading!
I've been seeing a lot of tweets and posts suggesting this drop and the few more to come are a result of Elon Musk's tweet about Tesla no longer accepting bitcoin. How can you blame one man's tweet, that even states "Tesla will not sell it's Bitcoin" for the drop in price? Here's the truth:
Bitcoin has been far over extended since the first move to $60,000 in the middle of March. On top of that, Bearish divergence has been building on MACD, RSI, and price action. Let's look at volume, as the price kept moving up, volume kept moving down. This is class A bearish price action. This drop was very obvious from the final move to $65,000 then the retest (right shoulder of the HS) of $60,000.
Elon Musk may have thrown a match into a pit of gasoline, but so many other factors were doing the same. This market needs to cool off to gain more investor interest to make higher highs. Bitcoin has finally tested its 20 weekly MA after 5 months of not being anywhere close.
Are we in a bear market? No, we are still far from a bear market. My guess is that we see a similar move to the chart on the right. There was a valid HS, Bitcoin dipped 10%, then it consolidated. After consolidation, it was moon time.
I imagine something similar will happen. This head and shoulders is to reset the market for another large move upwards.
I hope this helps clear the air. Price action, in my opinion, is the best way to indicate the health of a market move. Exhaustion was inevitable.
As always, be patient, have risk management, and good luck trading!
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