Bitcoin - Don't celebrate just yet
Updated
Today's bullish break of 10k is very nice to see. After over a month of consolidation in this range, we have finally broken to the upside. However, in my opinion, there is a decent chance that this ends up just being a fakeout before we revisit the lows.
First of all, the fact that we are above the 200d, 100d, and 50d MAs is a bullish sign. It is also reassuring that the daily MACD is crossing up. Breaking the 10k resistance is also great.
But, here's some bearish indicators to take note of.
First of all, we have not broken 10.5k just yet. Until we break 10.5k, this could just be a lower high. Not to mention the downtrend line (pink) from the 20k and 14k tops. Add on to that the volume for this breakout, which really leaves a lot to be desired. Perhaps the biggest concern for the bulls here should be this very prominent bearish divergence on the RSI.
All this being said, I am still cautiously bullish until we find ourselves back underneath 10k. As long as we stay above 10k, I think bulls are in control.
Ideally, what I'd like to see happen is a strong bullish impulse that quickly takes us above both the 10.5k resistance and the pink downtrend. Only then will I be totally confident that this isn't just a huge fakeout.
Good luck trading out there
First of all, the fact that we are above the 200d, 100d, and 50d MAs is a bullish sign. It is also reassuring that the daily MACD is crossing up. Breaking the 10k resistance is also great.
But, here's some bearish indicators to take note of.
First of all, we have not broken 10.5k just yet. Until we break 10.5k, this could just be a lower high. Not to mention the downtrend line (pink) from the 20k and 14k tops. Add on to that the volume for this breakout, which really leaves a lot to be desired. Perhaps the biggest concern for the bulls here should be this very prominent bearish divergence on the RSI.
All this being said, I am still cautiously bullish until we find ourselves back underneath 10k. As long as we stay above 10k, I think bulls are in control.
Ideally, what I'd like to see happen is a strong bullish impulse that quickly takes us above both the 10.5k resistance and the pink downtrend. Only then will I be totally confident that this isn't just a huge fakeout.
Good luck trading out there
Note
Okay. It looks like I was right about this being a fakeout unfortunately. Which sucks because I really didn't want to be right. But whatever. Where do we go from here? My target is my old target of ~8k, right where the 200d MA is at. Again, I can see a wick into the 7.5k region depending on how strong the sell off is.To be honest, based on the size of this rejection and the apparent lack of buyers, I actually think it's possible that we end up below the 200d MA again and find ourselves back in the 6k region. In that scenario, I expect alts would get destroyed. Anything below 6k and I think the long term viability of cryptocurrency as an investment is in question.
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