Why Bitcoins Pull-Back-Scenario Should Not Be Underestimated!

19 oct 2020

Hi Traders Investors And Community, hopefully, everybody is doing well in these times and welcome to this analysis where we are looking at Bitcoins 6-hour timeframe perspective, Bitcoin has managed to recover since the heavy bearish breakdowns into the 10.000 USD psychological support mark where it managed to form some uptrends and this huge ascending-channel-formation, nevertheless there still some very important resistance layers above which should not be underestimated and overall a pull-back-scenario isn't still fully unrealistic at the moment as bitcoin does not yet have established a concrete trend where technically it is still trading within this bigger perspective sideways-movement. Now there are some very important scenarios we should consider in the current situation which are imminent upcoming and can swift the whole dynamic again, an important question will be how strong possible pull-backs can look like and how bitcoin can possibly manage to recover from them, therefore I detected the meaningful levels and upcoming outcomes we should consider within this situation.

When looking at my chart you can watch there that bitcoin is just trading right above the point of control of the volume profile marked in red where it is building somewhat of a triangular formation together with the descending-trend-line and the middle-line of the ascending-channel-formation also bitcoin has the support within the 30-EMA marked in my chart in grey, these signs indicating a new reality to establish taking bitcoin from here higher in the structure however this rally will directly lead into crucial resistance layers above where not only the wave-counts are ending but also still strong resistance lying consisting of the horizontal resistance in red and the upper boundary of the channel coming together and forming this considerable short-entry-zone as it is marked in my chart, currently the bullish trend-establishment isn't strong at all and therefore a pull-back-scenario is likely to happen sooner or later which has good potential to show up when bitcoin makes this last move into the strong resistance layer suggested.

The next times will show how bitcoin reacts when moving into the resistance and it will be important how the pullback will look like, if it is strong or not, the initial-pull-back target here will firstly be the lower-boundary of the huge ascending-channel-formation where bitcoin has support and possible to recover, when this support does not hold and bitcoin does not show the proper reversal signs within this the pullback can move on into the pull-back-extension zone where the lower levels will be pointed in which the 10.000 USD mark will be tested again. Overall we should not overspeculate the currently still marginal rally to the upside which has not yet confirmed a decisive outcome and trend-establishment, therefore it is so much more important that we do not take the pull-back-scenario by side here as the past has shown that this can show up more swiftly than expected especially within the volatile cryptocurrency space. The next time we need to assess how bitcoin advances further in the structure here and it will be interesting as well as important development when the reverse scenario is also taken into consideration.

In this manner, thank you everybody for watching the analysis, feel free to support, have a good day and trading, all the best!
"Great alterations happen outside the usual experiences."

Information provided is only educational and should not be used to take action in the markets.

19 oct 2020

Nota

Bitcoin formed the breakout above the dashed trend-line as expected and will now approach the upper resistance.