BTC: Another Doji Candle close (what now?)

27 ene 2021Taking a deep look into the techincals and patterns developing in Bitcoin after it's historic move in January to fresh ALL TIME HIGHS ($41,986), only 14 points away from $42,000. This is also inlcuding ALT coins like ChainLINK, ETH ethereum, DOT PoklaDot making news highs as well! SO much going on in the crytocurrency world. News is circlaling daily of new hedge fund assest mangers and investors allotcating capital to adding Bitcoin to the portfolios. We as traders have to keep senitment in mind while still discounting all the considered "noise" in the markets. That's where technical analysis starts to tell us the story of who is in control... the bulls or the bears? Once that's indentified then you can start gauging for new buying or selling opportunities that the market presents to us as traders/dca'ers/investors etc.

Let't take a look at the moving averages first. These indicators help us take price averages and see if we are uptrending or downtrending in the ranges. If you see pirice bouncing at weighed averages then you know the price action is bullish (up). If it keeps getting rejected and pulled down below moving averages then price action is usally considered bearish (down). Bitcoin has been trending higher and been bouncing of the 21ma since Oct 2019. However, now the price action is now below the 21ema and is seeing selling pressure at the points of contact. (Broke below the 21ema Jan 21). Now, since that close Bitcoin has printed 2 spinning tops candles and 3 Doji candles (including the previous close). So we are seeing reversal candles being printed near the fib .382 right above the "golden zone". This is giving us mixed signals. Are we headed lower or higher? Well, let's now look at the volume. The order books have been very thin. The volume has been light to say the least. If you are a seasoned crypto trader/investor you know this price activity usally happen before a BIG MOVE. The quite before the storm.

Reasons to be bearish or bullish

BULLISH CASE:

*RSI OVERSOLD
*Buying in the dips in the "golden zone"
*Pennant Pattern
*Buying at the uptrending trendline
*Consolidation near $30,000 (above the 50ma)
*Higher lows since breakout @ $13,800


BEARISH CASE:

*Below 21 EMA (and moving average curing downward)
*Rejection of 21EMA on bounces
*Lower highs after hitting all time highs
*Low volume on pumps
*CME FUTURES Gaps still below near $26,000 and $20,0000 (99% of the time they eventuall fill)

As traders we don't want to be too bias on one side of the trend, We want to look at all angles and make a gameplan based on the price action.

Pivots to watch:

Support range: $27,500-$31,000 (Fib .5 and .0382)

Resistance:
intraday $33,800 (over the 21EMA)
Daily $36,000 (over the uppper trend)

We have to wait to see where the market pulls BItcoin now. If we breakout out above $36,000 Bitcoin could make a retest at highs at $42,000. If so we should see a squeeze to fresh highs $45,000. If Bitcoin decides to push lower to $27,500 then there will be a magnet to the nearest CME gap at $26,000 range.

What are you seeing in the charts? Please share your comments and thoughts below!

Thank you for reading!

V @ CRYPTO LEVEL UP