Short

Bitcoin - August 5, 2020 (Bearish)

Updated

Hello everyone,

... back with another update.

The take-aways of today's post are:
- Yesterday was a non-event in terms of the BTC price (O: 11,236 <> C: 11,192).
- I remain bearish
** despite the (2.7%) recovery from yesterday's low (11,000 <= mark that figure...); and
** because BTC is still struggling with the .50 Fib level (11,330).

Let's take a look at the 4H chart.

- Since the August 2 dump, we have been range bound between the .382 Fib (10,920) and the .50 Fib (11,330) (disregarding the local high (11,480) of August 4).

- We are currently seeing a (minor) price rally, following yesterday's 11,000 low. However:
** volume has been declining consistently;
** we haven't (convincingly) broken the .50 Fib (11,330) resistance;
** we haven't set a (local) higher high (=> for that, we need to break above 11,480).

- On the plus side: we are currently above the 21-period (4H) SMA (red curve), the 21-period (4H) EMA (blue curve) and the 50-period (4H) SMA (green curve).
** Hence, the 11,230 - 11,270 zone will likely act as a first line of support.

If we take a look at the (4H) RSI chart, we see that
- the RSI (pink curve) has bounced off the .45 level and is currently on it's way up;
- there is no (hidden) divergence; and
- the Bollinger Bands have tightened significantly.

This suggests that a (short term) burst is on the horizon.
=> Given the positive signals on the RSI, I would expect a break to the upside.

However, unless that break (1) occurs with substantial volume and (2) takes out the previous local high (11,480), I will not change my bearish stance.
___________________________________________________________________________________________________

OPINION (Unchanged): BEARISH

ANALYSIS (updated):
-----------------------------
See above

Note

Quick update!

The burst is happening as I predicted.
BTC is currently testing the previous local high.

I will flip to NEUTRAL / BULLISH, if we get a 4H candle close above 11,500.

Note

Edit: also note that volume is picking up. Hence, this is most likely not a fake-out!

GeertVD

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