I realize there's a lot of dogmatic bearishness out there trying to convince everyone that we MUST go down. However, they fail to grasp the importance of what has happened. Price has pushed cleanly through, and remained above, the 2-month long descending broadening wedge. This is one of the most consistently bullish patterns found in markets, especially crypto. This 1D chart also shows us that price has recently bounced off the vicinity of the descending log line from the all time high. Could we still drop further? Of course; nothing is guaranteed in trading. But it is currently much less likely than heading upward. The 3D chart shows us a likely reversal candle printing. This, again, adds credence to the idea that we need to retrace a bit before resuming strong upward momentum. Pay attention to MACD on the 3D, though, because it is nearing a bullish crossover. Ultimately, it is likely that today's candle and the current 3D candle will direct price action, whether it is continued upward movement or a retrace before doing so. This doesn't mean that the next 3D candle must be bearish, only that we may see a lower wick on it before the commencement of price appreciation and a resultant bullish candle. The current 3D candle could merely represent a pause in the advancement.
We discuss market psychology daily during the live streams as a way of helping retail traders understand why they shouldn't be blindly following the herd near areas of support (ATH, April 12th, and now, for example). Remember, retail traders don't move the market -- they lag behind. It's the MM that sets the stage for price movement and, once nudged in a direction, retail traders jump on the bandwagon. So traders need to stop assuming that they, as a whole, need some kind of significant news or reason (other than price action) to change sentiment. Price changes direction before retail market sentiment does, making the latter a product of the former.
See the 1H and 6H charts below as well.
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Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.