Daily Report – Bitcoin and Market Update (November 14 2020)
Middaily sessions have formed rising wedge type of a chart pattern. In fact, it often happens that extended 5th Elliot Wave’s impulse wave ends with such a pattern. Wedge breakdown with weak confirmation, when combined with the top steepest fan trendline that has just been broken, all together may indicate that the corrective movement has just started. Does it mean it’s safe to short? Of course not, most traders should never trade shorts in bull market, as the trades they would open stay opposite to the primary trend direction. In most cases it ends with losses for 80%+ of short-term traders. According to the fan principle, after the steepest trendline support is lost, the next support is provided by the trendline of smaller steepness. This would mean that the next expected support can be found between 14.8k (trendline) and 15.1k (VWAP). Correction is locally invalidated only after breakout and daily close through 16500.
Middaily supports are also provided by other price-action and MA levels: 14100, 12500, 12000 on which traders could expect bullish reactions. Momentum has curved down after bearish crossover in the overbought area. Because the cross happened inside the overbought area, it can’t be classified as ultimate reversal signal so far. In case of fakeout and upside continuation the next resistances are 16.5k, 17k, although currently it’s not the most probable scenario.
MTF picture clearly shows local rising wedge which presented traders with a fake breakout on the intraday basis and then breakdown. No massive liquidations on these movements and relatively stable price action. No exponential intraday movements suggest that the nature of these movements was relatively organic with no long/short squeezes. It’s unquestionably a situation that market is taking a breath before the next massive movement. Rising wedge technically is most often a bearish reversal pattern. Currently BTC/USD is retesting the “breakout” and is sitting in the LTF support area 15630 (MA50) – 15920. If this zone is held as support then bitcoin may continue upwards with the final, ultimate push for blow-off top to low-mid 17000s. If the support is broken down, then the cliff-drop may get started at any moment accelerating the selloff towards 13.6k (MA200). It’s definitely suggested to take profits on the way up. Unrealized profit is no profit. 99% of unexperienced traders will try to catch the top here. It’s impossible. It’s the whales that flip the market trends and make the reversals. It takes millions of $ to stop strong FOMO trend, so it’s going to be whales dumping 50-100M profits not your 100$ position. FYC.
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