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Choppy waters as BTC sets up for a strong move.
Resistances & Supports.
Resistances - Same levels as yesterday
Zooming out, we see price struggled to break above the zone at $6.9k we highlighted previous in the week. This zone remains the pivotal level for bulls to break above.
Looking ahead, a break above $6.9k would set sights on the next macro level at $7.7k.
Supports - Same levels as yesterday
As price moves with gusto towards new lows, it seems likely we break below the February bottom at $6k. Overlapping multiple time frame levels highlights the support from $6k-5.8k, which will be a zone to set some bids in for a bounce as price tumbles down. Should $5.8k fail to hold, there is a nice set of equal lows at the $5.4k mark which will act as support.
In the event price finds its way all the way down to the $5k level, buying in the long term support zone from $5-4.7k will be a good bet for at least a strong bounce.
Ichimoku Cloud.
Price is officially in a bullish trend based on 4H cloud metrics. There is a confluence of support from the cloud metrics (red line/kijun and cloud edge) with the horizontal level price range from $6350-6.3k.
Oscillators.
The 4H RSI is showing a potential hidden bullish divergence in the make at the moment, with a break above 68 RSI. A hidden divergence implies continuation, in this case would be a continuation of the bullish movement which preceded this setup.
Conclusion.
BTC has experienced rather low volatility over the past few days, chopping around in the higher $6000s. As we have seen in the past, low volatility always precedes higher energy moves, which means it is time to pay attention. A break above $6.9k would be majorly bullish and signify a bullish trend with the next test being around $7.8k. Strong support remains below at $6.3k.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Nice spring giving price a push from the $5.8k level today.
Resistances & Supports.
Resistances - Same levels as yesterday.
Zooming out, we see price struggled to break above the zone at $6.9k we highlighted previous in the week. This zone remains the pivotal level for bulls to break above. Looking ahead, a break above $6.9k would set sights on the next macro level at $7.7k
Supports - Same levels as yesterday.
As price moves with gusto towards new lows, it seems likely we break below the February bottom at $6k. Overlapping multiple time frame levels highlights the support from $6k-5.8k, which will be a zone to set some bids in for a bounce as price tumbles down. Should $5.8k fail to hold, there is a nice set of equal lows at the $5.4k mark which will act as support.
In the event price finds its way all the way down to the $5k level, buying in the long term support zone from $5-4.7k will be a good bet for at least a strong bounce.
Ichimoku Cloud.
The 4H cloud tenkan indicator nailed price perfectly and provided resistance around the $6.2k mark. This will be a level to keep in mind as price attempts to make its way forward.
Oscillators.
The daily RSI is beginning to paint a very rare signal in the form of a bullish divergence. This is only the beginning of the construction of this signal, and is only confirmed when the RSI makes a new high above 42.7. That said, this is comforting for the bulls to see the price drop is not truly reflective of the underlying strength behind the asset.
Conclusion
Price looks to have broken below February low in an attempt to grab massive liquidity and shoot above the support level.
Although we haven't seen the expansive candle with a huge increase in volume and wick, this is possible bottom behavior.
A break below this level will likely get ugly fast, with $5.4k and $5k as places to place orders below.
Twitter: @BoomerCapital
Web: boomerangcapital.org
Looking to the upside we need to get above the recent high and resistance at $6.2k before marching onwards to $6.9k.
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Short squeeze into resistance this morning, giving bulls a new found sense of confidence.
Resistances & Supports. Same levels as yesterday
After breaking above the $6.4k resistance we now set our sights on the previous swing low around $7.2-6.9k. Above $7.2k we will look to break $7.7k and change the market structure in the mid term bullish.
Supports - Same levels as yesterday
The resistance at $6.4k now turns back into support, making this a zone we expect price to experience a bounce/reversal from if/when price retraces after this large move. Below $6.4k remains the large bullish zone from $6k-5.4k.
Ichimoku Cloud.
The 4H cloud is currently providing some resistance to price when looking at the cloud metrics. A break above the cloud and above $6.9k still remains the first objective.
Oscillators.
The weekly stoch is the most oversold it has been in over 3 years. This is not to be seen as a direct signal for a trade entry/exit but more a point of perspective on the current market environment, one in which the optimal selling opportunity is past due.
Margin Positions.
A look at the total BTC/USD short positions open on Bitfinex shines a light on the move earlier in the day as Bitcoin sprung up a few hundred dollars. This move was propelled likely by a string of short liquidations as the number of shorts dropped in unison with the price rise. Short squeezes are not the most sustainable of moves so a retrace back to retest the point of breakout is likely.
Conclusion
At the moment, although there was a strong move upwards, BTC is not out of the woods yet.
Short squeeze price action is less fueled by organic buying interest than it is over-leveraged margin traders.
Due to this we are looking for a confirmation of market structure before turning bullish, in which a break and hold above $6.9k on higher time frames would be a great start.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Bitcoin Daily Update.
Sideways movement after the high volatility move yesterday.
Resistances & Supports.
Resistances - Same levels as yesterday.
A bounce here would set our sights on an intermediate resistance at $7.0k created by the previous low.
Should price break $7k we will look at the resistance from $7.7-7.9k as our next major target.
Supports - Same levels as yesterday.
The next support zone is derived from the previous local bottom at $6.7-6.4k. This zone also lines up with a fib level drawn all the way back from the correction to $3k.
A break below $6.4k will likely see price fall to new lows. A very strong support zone for this scenario would be at $5.8-5.5k.
Longterm, the previous top at $5k is an obvious buy level, with added support down below it to $4.7k.
Ichimoku Cloud.
The 1H cloud is now showing a tenkan kijun disequilibrium, which will likely result in a reactionary move, causing these two indicators to be closer to one another. In this case this move would be to the upside, giving the probability of a retrace upwards added weight.
Oscillators.
What we do see on the 1H RSI is a hidden bearish divergence, which suggests continued downside. Although, this is a lower time frame divergence and nothing that would cause an extreme move.
Conclusion
Just as low volatility precedes high volatility, the reverse can be said as well. We see that occurring at the moment as price rests following the high energy move we saw yesterday. It is likely we see a retrace (bounce) upwards to stabilize the price action and capture any missed volatility from the large liquidation event yesterday which left a gap in market structure.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Price knocking at the door of resistance from $7.7-7.9k.
Resistances & Supports.
Resistances - Same levels as yesterday
The $7.9-7.7k resistance level remains important to break above as price bounces back in that direction. A break above $7.8k would be a higher high in combination with the higher low, legitimizing the temporary uptrend.
Supports - Same levels as yesterday
The $7.5-7.4k support is holding for the moment, as we see a strong bounce off of this level.
Should price break below $7.4k we do have a support zone below from $7.2-6.9k, which will be a very important level to hold.
Classical Chart Patterns.
Inverse head & shoulders pattern - Remains intact
A break below the right shoulder would invalidate this pattern. The bottom of the right shoulder lines up roughly around $7.3k
Symmetrical Triangle - Remains intact
The higher time frame pattern symmetrical triangle remains valid as long price does not move below $6.9k. A break of either trendline creating this pattern will be foretelling of the medium term price action.
Moving Averages.
The 200 EMA on the 4H chart also lines up with our $7.9k level listed above. This moving average has acted as a resistance and support in the past and we can expect it to act similar as we close in on this level in the future.
Ichimoku Cloud.
Looking ahead at resistance levels we see that the 4H cloud edge lines up with our above zone of resistance listed in the price action section at $7.9k. A break above the cloud edge would signify the beginning of an uptrend based on cloud metrics.
Oscillators.
The vortex indicator has signaled a bullish cross on the daily chart, similar to the reversal from the previous lows.
Conclusion
The $7.9k level of resistance has a confluence of indicators which will act as resistance, meaning a break above this level will then flip those indicators to support. If we manage to break above that level that would be a major bullish signal and a sign of more significant upside to come. Consolidation below resistance is a bullish sign, showing buyers are in control chipping away at supply.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Bounce occurring at support and 4H cloud kijun. Higher low posted if this level continues to hold.
Resistances & Supports.
Resistances
The $7.9-7.7k resistance level remains important to break above as price bounces back in that direction. A break above $7.8k would be a higher high in combination with the higher low, legitimizing the temporary uptrend.
Supports
The $7.5-7.4k support is holding for the moment, as we see a strong bounce off of this level.
Should price break below $7.4k we do have a support zone below from $7.2-6.9k, which will be a very important level to hold.
Classical Chart Pattern.
Inverse head & shoulders pattern (remains intact): A break below the right shoulder would invalidate this pattern. The bottom of the right shoulder lines up roughly around $7.3k.
Symmetrical Triangle (remains intact): The higher time frame pattern symmetrical triangle remains valid as long price does not move below $6.9k. A break of either trendline creating this pattern will be foretelling of the medium term price action.
Ichimoku Cloud.
The 4H kijun has held for price and acted as support, for now, sending price back into the cloud. This now sets the target back to the 4H cloud edge at $7.9k.
Oscillators.
The 4H oscillators look to have reset and recrossed bullish out of the oversold zone, supporting the current bullish bounce and recovery. There are currently no divergences of note at the moment.
Conclusion
The bounce at support earlier today is very confidence inducing for the bulls, making a strong argument for a continued rally upwards. A break above $7.8k would validate the uptrend. A break below $6.9k would be a strong warning sign of lower prices to come in the future.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Rejection at resistance occurred, price now at a high probability bounce/reversal level of support.
Resistances & Supports
Resistances - Same resistances levels as yesterday.
Now that price has broken above $7.5k we can target the next level at $7.7-7.9k which has caused strong price reaction in the past. A break above $7.5k resistance now flips this zone to support.
Supports - Same resistances levels as yesterday.
Should price fall below the intermediate support zone at $7.5k the support zone below from $7.2-6.9k remains intact.
Classical Chart Patterns.
Inverse head & shoulders pattern: A break below the right shoulder would invalidate this pattern. The bottom of the right shoulder lines up roughly around $7.3k.
Symmetrical Triangle: The higher time frame pattern symmetrical triangle remains valid as long price does not move below $6.9k. A break of either trendline creating this pattern will be foretelling of the medium term price action.
Ichimoku Cloud.
Price has fallen out of the 4H cloud and below the tenkan (blue line), leaving the last level of support from the cloud metrics to be at the kijun (red line). This price level is in line with our horizontal price zone we have mapped out at $7.4k making the current price a highly confluent level of support.
Oscillators
On the 4H we see that the RSI has posted lower lows while the RSI has remained above the last low, creating a hidden bullish divergence. A hidden divergence implies continuation of the current trend while a normal divergence implies a reversal. In this case, the hidden bullish divergence is signaling a case for continuation of the move upwards from $7.0k.
Conclusion
Price was rejected at the mapped out resistance level created by the .618 fib and $7.9-7.7k horizontal resistance level as expected. The current price action hints at a bounce back upwards as a hidden bullish divergence builds at the support level from $7.5-7.4k. A break above the current high at $7.8k would be very bullish and signify a definite uptrend composed of a higher low and higher high
Twitter: @BoomerCapital
Web: boomerangcapital.org
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ZEN/BTC tough chart to read so let's make some light of how to trade this coin. It doesn't like to trend a certain direction for long and instead moves in these hard to predict zig zags that are really volatile. The one thing that is certain is that .005 is strong resistance for ZEN, most of the rallies end there, a break above that from a chart perspective should give it wings In the mean time its falling into support here at .0037 You may be able to catch a short term bounce play off of that level but in regards to long term, due to the volatility i'd look to buy lower and when I do make a purchase only do small increments at a time since the volatile movements are hard to predict Chart here. https://twitter.com/BoomerCapital/status/1003444908533747712Twitter: @BoomerangCapital Web: boomerangcapital.org |
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Coin: AION
In a historically strong accumulation zone. A very strong interoperability coin.
A stop loss below .00023 below the accumulation zone in green is recommended.
Target = undecided for now, looking to ride a major trend with this one.
Tweezer tops on the 1 hour 12 hours ago.
Just looking at the 1 hr chart it looks like we are approaching a level of support right now and while looking at the daily charts we are coming to solid support there as well.
If we bounce off that support look for that tweezer top to be a decent resistance zone. We could also see resistance at the previous top 0.002836 which could be the formation of a head and shoulders pattern.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Price inching upwards with an important resistance to clear at $7.9k overhead.
Resistances & Supports
Resistances - Yesterday's resistance levels still in place.
Now that price has fallen below the intermediate level at $7.5-7.4k, this will act as resistance on the way back up. Above $7.5k we will begin to set our sights on the higher levels such as $7.9-7.7k.
Supports - Yesterday's support levels still in place.
At the moment we are coming down to a very important support zone from $7.2-6.9k. This is an important level to hold due to it being an important fib level and the diagonal trendline support for the symmetrical triangle pattern in play.
Classical Chart Patterns.
The larger time frame symmetrical triangle is still holding up as price nears the supporting trendline. Should price break and close on the daily below $6.9k this pattern will be resolved to the downside and the measure rule sets us well beneath the current bottom at $6k.
Ichimoku Cloud.
The 2H cloud is now acting as resistance. Though, at the moment the tenkan and kijun are in a cluster which may act as support for now and send price back upwards to retest the cloud. We also see a bullish TK cross on the 2H cloud (tenkan/blue line over the kijun/red line), which gives the lower time frame a bullish bias.
Oscillators.
Looking at a few daily oscillators we see some bullish signals in the making as the stochastic oscillator has a bullish cross, with the MACD looking to do the same very soon. The last two times we saw these signals sustain price went on to make very strong moves to the upside.
Conclusion.
Price continues to rally, struggling a bit to decisively break above resistance at the moment, but it seems more upside is to come.
The next resistance ahead is the previous support and .618 fib level at $7.9-7.7k. The way price handles this block will be very telling if this is just a "dead cat bounce" or a true reversal.
Those that followed the previous updates and recommendations to scale in buys down to $6.8k would be well off to set their stop losses in profits in the case this was nothing more than a bounce.
That said, there are multiple short-term technicals alluding to continued bullish price action.
A break of $10k would be a higher time frame higher high, following what would be a higher low if $7k stands as a swing low, indicating a confirmed uptrend.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Alt Signals, PAID Trading, Asian Whales Club People continuously come to us complaining they have subscribed to several different signal groups but get the same signals. We have seen proof that they just copy each others signals. Sourcing each others signals, denying it, & charge subscribers. Please be careful who you subscribe to. https://twitter.com/BoomerCapital/status/1001763470243590145Twitter: @BoomerCapital Web: boomerangcapital.org |
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Bulls taking a natural breather after yesterday's large move.
Resistances & Supports.
Resistances - Yesterday's resistance levels still in place.
Now that price has fallen below the intermediate level at $7.5-7.4k, this will act as resistance on the way back up. Above $7.5k we will begin to set our sights on the higher levels such as $7.9-7.7k
Supports - Yesterday's support levels still in place.
At the moment we are coming down to a very important support zone from $7.2-6.9k. This is an important level to hold due to it being an important fib level and the diagonal trendline support for the symmetrical triangle pattern in play.
Classical Chart Patterns
The larger time frame symmetrical triangle is still holding up as price nears the supporting trendline. Should price break and close on the daily below $6.8k this pattern will be resolved to the downside and the measure rule sets us well beneath the current bottom at $6k.
Ichimoku Cloud
The 2H cloud is now acting as resistance. Though, at the moment the tenkan and kijun are in a cluster which may act as support for now and send price back upwards to retest the cloud. We also see a bullish TK cross on the 2H cloud (tenkan/blue line over the kijun/red line), which gives the lower time frame a bullish bias.
Oscillators
The vortex indicator and RSI are shaping up to look very similar to the reversal we saw at $6.4k. We had a nice rise from the RSI yesterday, allowing space to drop should we fall further into support, setting up a potential bullish divergence on the daily which would be a strong buy signal.
Conclusion
After the strong move yesterday, it is very natural for us to retrace some of the move, markets move in peaks and valleys on all time frames.
A bit of sideways around this support to allow big players to accumulate BTC at a cheap price before moving upwards, similar to the situation we saw at $6.4k would be of no surprise.
A break above the $7.9k resistance block would solidify the short term uptrend. A break below the $6.8k level of support would signal further downside to come and reason to believe we would see new lows below the recent one at $6.4k
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Strong bounce off of the buy zone we highlighted throughout the week. A break and hold above $7.5k will be the beginning of a short-term uptrend.
Resistances & Supports.
Resistances - Yesterday's resistance levels still in place.
Now that price has fallen below the intermediate level at $7.5-7.4k, this will act as resistance on the way back up. Above $7.5k we will begin to set our sights on the higher levels such as $7.9-7.7k.
Supports - Yesterday's support levels still in place.
At the moment we are coming down to a very important support zone from $7.2-6.9k. This is an important level to hold due to it being an important fib level and the diagonal trendline support for the symmetrical triangle pattern in play.
Classical Chart Patterns.
The larger time frame symmetrical triangle is still holding up as price nears the supporting trendline. Should price break and close on the daily below $6.7k this pattern will be resolved to the downside and the measure rule sets us well beneath the current bottom at $6k.
Ichimoku Cloud.
The 2H cloud, which is a good representation of a lower time frame trend, has rejected price on each attempt upwards. A break above the cloud on the 2H, which lines up with the $7.9-7.7k resistance levels we have highlighted, would be a very bullish signal.
Oscillators.
The daily stoch oscillator is bouncing from lows we have not seen in over TWO YEARS. The fact that we are reaching this low on the oscillator and have yet to make lower lows shows that sellers are losing control on price action.
Conclusion
At the moment price is painting a very strong bullish engulfing candle on the daily chart. With oscillators set up for upside and price bouncing off of support, this could have very well been the short-term bottom. A break above $7.5k will set up a bullish lower time frame market structure and turn that level of resistance into support.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Price very close to a very important support zone now, if a bounce is to come and bulls want to reverse, these levels are the place to do so.
Resistances & Supports.
Resistances - Yesterday's resistance levels still in place.
Now that price has fallen below the intermediate level at $7.5-7.4k, this will act as resistance on the way back up. Above $7.5k we will begin to set our sights on the higher levels such as $7.9-7.7k.
Supports - Yesterday's support levels still in place.
At the moment we are coming down to a very important support zone from $7.2-6.9k. This is an important level to hold due to it being an important fib level and the diagonal trendline support for the symmetrical triangle pattern in play.
The larger time frame symmetrical triangle is still holding up as price nears the supporting trendline. Should price break and close on the daily below $6.7k this pattern will be resolved to the downside and the measure rule sets us well beneath the current bottom at $6k.
Ichimoku Cloud
The 1W kijun has now crossed above the tenkan, meaning the recent price action on the weekly chart is more bearish than it has been over the long haul, insinuating more bearish price action will continue. Should price move upwards from here, we will have a bullish recross on the weekly which would signal a great entry for those without a BTC position.
Oscillators
The 1D RSI has officially entered the historic zone that has signaled an oversold BTC and led to reversals in the past. Although past performance is not indicative of future price action this is a fairly strong signal and not one to take lightly.
Conclusion
Price continues to slow bleed down towards a strong support created by a plethora of price levels, fib zones, and chart patterns. Scaling in buys down to $6.8k sets one up for a decent risk:reward ratio with a stop loss below $6.7k in case price blows through the support.
To my American mates. Have a safe and meaningful Memorial Day
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Bears attempting to bring price lower on low volume as a bullish divergence builds above support.
Resistances & Supports.
Resistances
Now that price has fallen below the intermediate level at $7.5-7.4k, this will act as resistance on the way back up.
Above $7.5k we will begin to set our sights on the higher levels such as $7.9-7.7k.
Supports
At the moment we are coming down to a very important support zone from $7.2-6.9k. This is an important level to hold due to it being an important fib level and the diagonal trendline support for the symmetrical triangle pattern in play.
Classical Chart Patterns
The larger time frame symmetrical triangle is still holding up as price nears the supporting trendline. Should price break and close on the daily below $6.8k this pattern will be resolved to the downside and the measure rule sets us well beneath the current bottom at $6k.
Moving Averages
The weekly 50 MA is currently being breached as we go into the weekly close, 6 hours from now. We saw a similar setup in 2014 with a break above the trend line resistance (bull trap) and then back beneath the 50 MA on the weekly to continue to the bear market. A break of the 50 MA today would be another additional sign that the market plays out similarly to what we saw in 2014.
Ichimoku Cloud
The 4H cloud is showing continued distance between the tenkan (blue line) and kijun (red line), showing that the down move is execessive and more drawn out than the movement over the longer time frame. This is likely unsustainable, at least without a bounce.
Oscillators
The 4H RSI is building a bullish divergence right above support, which is quite a strong signal, not as strong as the daily RSI, but still one worth mentioning and watching. This shows that there is underlying strength building even as price moves lower, which likely will resolve in a bounce as bulls regain back control.
Conclusion
Important time for Bitcoin at the moment as it hovers above historic lows. A break below the $6k lows will likely indicate a larger bear market, which to us here at Boomerang Capital see as an ever larger opportunity to average into better entries for the next impending bull market.
We are, however, at a very strong support with some bullish divergence already beginning to show. Many investors and traders in the space are exhibiting fearful and bearish sentiment.
The market has a way of making the many look foolish. Due to this it is important to keep a level head and focus on the charts, level by level, before making any drastic conclusions. For now, that level is $6.8k
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Price experiencing selling relief from the support level at $7.5-7.4k, strong support remains below if needed.
Resistances
Yesterday's resistance levels still in place.
The $8.7-8.5k zone of resistance continues to hold as a wall above price, this is the first target for price to move over.
Above $8.7k creates a lot stronger of a bullish case with little resistance in the way until $9.1k.
Supports
Yesterday's support levels still in place.
At the moment we are sitting at an intermediate support created by April 3rd highs at $7.5-7.4k. Additional support at this level comes from the confluence of the weekly 50 MA.
Below $7.4k is a stronger level of support created by the .786 fib and previous horizontal price action at $7.2-7.0k
Moving Averages
Zooming out to get a better perspective on the larger picture, the weekly 50 MA is currently moving upwards towards price at the $7.5k level. We have yet to break below this level throughout the "bear market," and it has served as a good level of support in the past.
Ichimoku Cloud
Looking back at the 4H cloud we see that we have fallen quite far away from the cloud in terms of price. The cloud is an indicator created by a moving average algorithm, meaning price is far below the average. This won't last long, as a reversion to the mean in price is always an underlying force in the market. Also, notice how the local bottoms have occurred closer to the cloud as the downtrend has continued. That coupled with the slope of the down move being a lot less sharp than the previous two, gives us hope that we are near the bottom of this current move.
Oscillators
The 4H RSI has painted a slight bullish divergence which seems to be giving price some relief. The daily RSI is also in a zone that has been hugely responsive to down moves, providing strong bounces upwards from this level.
Conclusion
Bears seem to be losing strength at the moment as well as in the overall trend.
Price is nearing a relatively important level that could potentially set up for a bottom, which would create a very bullish structure for the market, posting a higher low, solidifying the symmetrical triangle chart pattern we discussed yesterday, and creating an even more rounded bottom argument for accumulation.
Longs opened from $7.2-6.8k with a stop loss right beneath will be set up for a solid risk:reward play. A break below those levels will be very detrimental to the trend, especially if we break below the recent local low at $6.4k, setting up a situation where long term buys to scale in at $5k would be wise.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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Low volume node being filled from short squeeze last month, intermediate support holding for now with a strong zone below at $7.2-6.9k.
Resistances
After falling through the $7.9-7.7k level of support indicated by previous support/resistance and the .618 fib level, this zone will now become resistance on the way back upwards. A move above $7.9k would set us up to challenge the $8.2-8.1k level.
Supports
At the moment we are sitting at an intermediate support created by April 3rd highs at $7.5-7.4k. Additional support at this level comes from the confluence of the weekly 50 MA. Below $7.4k is a stronger level of support created by the .786 fib and previous horizontal price action at $7.2-7.0k
Moving Averages
Zooming out to get a better perspective on the larger picture, the weekly 50 MA is currently moving upwards towards price at the $7.5k level. We have yet to break below this level throughout the "bear market," and it has served as a good level of support in the past.
Ichimoku Cloud
The 1D kijun has been decisively broken by price, creating a bearish environment via cloud metrics, suggesting further downside. Should the 1D tenkan (blue line) cross back below the kijun (red line) that would be a short signal for cloud traders.
Traditional Chart Patterns
Symmetrical Triangle: macro consolidation pattern is forming in the shape of a symmetrical triangle. This is created by two converging trend lines, one which acts as support and the other resistance, diminishing the range of price movement and trades. Volume drying up supports this pattern and shows there are less trades being taken within this range. Eventually the supply/demand balance will break above or below the converging trendlines, resulting in a breakout to the upside if the demand is larger than supply, and vice versa if the supply outweighs demand.
Conclusion
The strong downward move today has mimicked the strong up move we saw last month, which left a void that is currently being filled.
Although indicators are showing signs of bear, it is not very common you have the opportunity to buy Bitcoin below the 200 MA and in a bearish cloud environment. We say this to reiterate the fact that this should be seen as an opportunity.
Institutional money (i.e. Nasdaq creating a crypto trading platform, Poloniex being bought) would not waste their time with crypto if the volatility were to dry up, and at the moment the volatility's least path of resistance is upwards over the long term.
The next important level of support comes in the range from $6.9-7.2k, a bounce there would confirm the symmetrical triangle and give bulls a chance to break that pattern to the upside.
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Many top traders are expecting the Bitcoin (BTC) price to go down to 7k-ish (down to the main trendline)
But as you can clearly see, the price has been holding above 8k.
So why won't it budge and go down further?
That is because we are likely on the corrective wave ((ii)) of the impulse wave 3.
The lowest this corrective wave can go is 8070.
In short, if price moves up from 8k, then it is going to 9700-10000.
It also confirms that we are indeed on a new bull cycle that leads to 40k by end of this year.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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4H bullish divergence showing, bounce/reversal looks likely.
PRICE ACTION LEVELS
Resistances
First and foremost, we have to break above the $8.5-8.7k zone of resistance and trade above on higher time frames.
Following $8.7k we will target $9.1k as an intermediate zone of slight resistance, similar to $9.4k.
Supports
At the moment we see price bouncing away from the $8.1k zone we have highlighted throughout the week. This zone is created by previous price action, as well as multiple indicators. Should $8.1k hold the next crucial zone of support is from $7.9-7.7k. If $7.7k does not hold a break back into the $6000s would not be out of the picture.
INDICATORS
Moving Averages (same situation as yesterday)
The 50 MA held as support for now. The next test is to see if we can turn around and break back above the 200 EMA after breaking below it so recently. Above that we still have the prevalent 200 simple moving average to breach.
Ichimoku Cloud (same situation as yesterday)
The 1D cloud remains intact with the tenkan above around $9.1k. Zooming into the 4H this level is also important as the kijun hovers around there as well. As stated before, based on cloud metrics, as long as we stay in the cloud the opposite edge of the cloud ($11.7k) remains in play.
Oscillators
The 4H oscillator (RSI) is now showing a pretty exaggerated bullish divergence, from an extreme level, at support. Due to this being a higher time frame level with the confluence of support there is a high probability that this level holds and provides price with a move back upwards.
Conclusion
Price looks to be coiling up for a move back upwards.
This weekly level around the high $7000s below price at the moment really needs to hold for the current rally to continue.
The 4H bullish divergence is textbook and also taking place right at support, meaning it would be a surprise if price did not catch a bounce at this level.
As it stands, this move on a weekly chart looks like a break of resistance and then a retest of the level. Although the last few days have been rather bearish, keeping a macro outlook on the chart allows you to keep a level head when making financial decisions, as well as remain patient.
Twitter: @BoomerCapital
Web: boomerangcapital.org
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