Bitcoin - The legend
In this chart you can see that a couple of things happened. #1 Just as I have been saying for a few weeks now, keep an eye on the 12H and the 200MA, once price goes under the 200MA on the 12H BTC will struggle to come back up, moreover, If price can't make it above the 200MA we will go down quite a bit. #2 We've had a trendline violation which it's yet another indication that BTC is weak and does not have any buyers at this point. The first X (from top to bottom) is sitting on very strong support so it may take a while to break through and keep going down.
This is what I will be on the lookout for:
The first X has very strong support, it may stage a rally once price gets there, that rally may lead to a big up move.
The first X has very strong support, if it breaks easily we'll tumble down to the upper 6k's (This is the likely scenario)
The first X has very strong support, it may take a while to break and if so we'll go to the low 8k after a little rally.
There are always leading measures (early signs) that give you a heads up about what is going to happen. In this case, the red downtrend channel line has become insane resistance. BTC can run up to it all it wants but if it does not go over it, it will lead to a big drop as punishment.
If BTC goes over this line we sit up and pay attention, what specifically are we looking for? We are looking for a new "High Low" or a new "High high" at which point I will indicate where to jump in.
Going back to leading measures; On the last post, I told you that if BTC closed more than 3 candles below the 50MA on the 12H it will lead to a down move. Well... here we are, it happened just as I said. Now, today we're about to close our second candle below the trendline, needless to say, that will lead to a further drop.
NOW, THE LEGEND;
So my charts are easier to understand I'm creating a legend, so here we go.
Support trendlines are green
Resistance trendlines are Red
Horizontal support lines are Black the thicker the stronger the support
50 Moving Average is yellow
200 Moving Average is Black
This is what I will be on the lookout for:
The first X has very strong support, it may stage a rally once price gets there, that rally may lead to a big up move.
The first X has very strong support, if it breaks easily we'll tumble down to the upper 6k's (This is the likely scenario)
The first X has very strong support, it may take a while to break and if so we'll go to the low 8k after a little rally.
There are always leading measures (early signs) that give you a heads up about what is going to happen. In this case, the red downtrend channel line has become insane resistance. BTC can run up to it all it wants but if it does not go over it, it will lead to a big drop as punishment.
If BTC goes over this line we sit up and pay attention, what specifically are we looking for? We are looking for a new "High Low" or a new "High high" at which point I will indicate where to jump in.
Going back to leading measures; On the last post, I told you that if BTC closed more than 3 candles below the 50MA on the 12H it will lead to a down move. Well... here we are, it happened just as I said. Now, today we're about to close our second candle below the trendline, needless to say, that will lead to a further drop.
NOW, THE LEGEND;
So my charts are easier to understand I'm creating a legend, so here we go.
Support trendlines are green
Resistance trendlines are Red
Horizontal support lines are Black the thicker the stronger the support
50 Moving Average is yellow
200 Moving Average is Black
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