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Bitcoin is struggling to break past the $7,246 resistance which was a strong support before the price declined below it. Even though BTC/USD has now entered the red zone on our chart, we still believe that it is ready to take off and rally much higher. When the price declined into the red zone, it should have crashed hard if it meant to, but the fact that it hasn’t tell us that a move to the upside might be in the offing. The near-term outlook of the EUR/USD forex pair increases the probability of such a move.

The 4H chart for the forex pair shows us that it has now rallied past the 200 MA which means that it could potentially break higher to form a triple top considering it has already broken above the 38.2% fib extension level. The more the price tests a certain level, the higher the probability that it will be broken. This pair has been testing the 38.2% over and over which means that this might be a time for it to rally much higher in the near future. This would be a bullish development for the entire cryptocurrency market because a decline in the strength of the US Dollar means a higher price of Bitcoin in US Dollars.

Ethereum (ETH) presents a clearer picture of what is really going on. The 4H chart for ETH/USD shows how the price has printed the exact same fractal that it did in September, 2019. Based on this, we might have a 20% move in Ethereum (ETH) around the corner. This could comprise of minor retracements along the way but it will come to fruition nonetheless in case of a rally from current levels. We have to see the price test the 200 moving average on the 4H time frame before a major downtrend. The next uptrend is likely to achieve not only that but also a retest of the previously broken market structure. Bitcoin dominance (BTC.D) has room to decline which means that altcoins could rally near term. This is a bullish development for the whole cryptocurrency market. The Fear and Greed Index is also back at “Extreme fear” which means that this might be a good time for contrarians to be bullish on the market.

Jefe Caan , 2019-12-04 18:30:00 ,

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NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.

While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock

Nick Chong , 2019-11-10 12:00:38

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