Scenario (another wave down):
I’m watching the 12 chart, on the if we see price reject a cross (blue line crossing over the red line), that will likely be followed by another wave down. Since early November, price is in a 31 degree , now dropping to the bottom of the current value range and testing key support levels. From peak to peak this is now a 20% drop if we find support in the current range. Resistance today is around the low $57k, and a rejection here will likely revisit one or several of the support levels listed below:
- 1st support is at the bottom of the value range ( ie . where most trading/positions are placed) between $54k and $56k
- 2nd is to the 20/ 21w support levels between $50k and $53k, they are historical bull market supports we sometimes revisit; closing a daily or weekly under them signals growing sentiment, possible bear market coming
- 3rd is the May resistance turned support in October between $46.4k to $49.5k.
Price needs to break above the 31 degree downtrend resistance. And above are layers of resistance, but the level bulls need to regain in short term is the 12h 20 that serves as short to mid range indicator of market sentiment. That is currently downtrend around $58.8k.
- Inflows rose to a level that previously triggered short term rising sentiment
- Supply on exchanges continues to reflect macro accumulation and the dip (so far) appears to be largely bought
[*}Open Interest is still elevated but dropped back to early October levels, this could afford additional shakeout but its a step in the right direction if we want to see continued upside
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