The white boxes on here are key levels to watch, the purple bands are minor support levels or order blocks that might come into play. Bottom line-- Bulls need to hold the $53k range, its one of the last meaningful support levels over $50k. The yellow channel we fell back into is our immediate resistance level, then a support flipped resistance at $55.4k. Bulls need to recover $58k for market sentiment to flip convincingly bullish here, imo. If you want to know more, read below.
Background: So until the combined efforts of COVID news and options broke below, Bitcoin looked on the road to recovery. MACD just crossed bullish, it just climbed over the 12h 20 EMA (around $58.6k) which is a solid signal of short to mid range price action- close above is bullish, close under averaged double-digit % drops more often than not, usually in the range of like 10-15% below the MA.
The first support is the bottom of our value range.. ie. the most commonly traded range since July. Typically that is where the edge of your local supports also live and if you fall from there, you continue down. Its not a hard and fast rule but its a thing.
Next support is the historical bull market support levels that are popularly combined into a band- the 20w SMA ($50.7k) and 21w EMA ($52.5k). Those are how I typically gauge bull from bear markets. Wicks under there on a weekly are okay, but closing a weekly under them is usually a sign of market sentiment flipping to predominantly bearish.
And the bottom support (white box) is the former resistance level from May that was part of the confluence of resistance in May that sent price tumbling down to $29k. We flipped that and confirmed as support in October with a very nice but deep wick down.. it held.
Bullish Scenario: We hold a level over $53k and continue to climb back up, with the yellow channel being the first level bulls need to recover, then the purple lines which represent local resistance levels, and finally a target of the 12h 20 EMA would be a great sign ($58.6k). That is the last meaningful support I see before entering the 20/21w Bull Market support band, and around $51.4k is a small confluence of support with an order block from early October. If we lose this and fall below $50.7k we flip to the bearish scenario.
Bearish Scenario: We have a small range between $50.7k and $47.8k that bulls will still have a shot at recovering before we enter a range where I expect increasingly bearish sentiment in the market, and the possibility of a larger selloff.
On-Chain Sentiment: I think On-Chain is largely bullish on higher timeframes. We see macro accumulation, generally bullish netflows, but we also saw overleveraged fools flooding the market which makes it easier for whales to use their liquidations as fuel for a move to the downside. The timing was great, we saw this sudden media scare about COVID across the globe, we had options expiring this morning (just a few hours ago), it was a good move on the part of whales to take advantage of the market conditions suddenly flipping overnight. Not financial advice but I think the on-chain narrative still paints a more bullish than bearish market at the moment
Background: So until the combined efforts of COVID news and options broke below, Bitcoin looked on the road to recovery. MACD just crossed bullish, it just climbed over the 12h 20 EMA (around $58.6k) which is a solid signal of short to mid range price action- close above is bullish, close under averaged double-digit % drops more often than not, usually in the range of like 10-15% below the MA.
The first support is the bottom of our value range.. ie. the most commonly traded range since July. Typically that is where the edge of your local supports also live and if you fall from there, you continue down. Its not a hard and fast rule but its a thing.
Next support is the historical bull market support levels that are popularly combined into a band- the 20w SMA ($50.7k) and 21w EMA ($52.5k). Those are how I typically gauge bull from bear markets. Wicks under there on a weekly are okay, but closing a weekly under them is usually a sign of market sentiment flipping to predominantly bearish.
And the bottom support (white box) is the former resistance level from May that was part of the confluence of resistance in May that sent price tumbling down to $29k. We flipped that and confirmed as support in October with a very nice but deep wick down.. it held.
Bullish Scenario: We hold a level over $53k and continue to climb back up, with the yellow channel being the first level bulls need to recover, then the purple lines which represent local resistance levels, and finally a target of the 12h 20 EMA would be a great sign ($58.6k). That is the last meaningful support I see before entering the 20/21w Bull Market support band, and around $51.4k is a small confluence of support with an order block from early October. If we lose this and fall below $50.7k we flip to the bearish scenario.
Bearish Scenario: We have a small range between $50.7k and $47.8k that bulls will still have a shot at recovering before we enter a range where I expect increasingly bearish sentiment in the market, and the possibility of a larger selloff.
On-Chain Sentiment: I think On-Chain is largely bullish on higher timeframes. We see macro accumulation, generally bullish netflows, but we also saw overleveraged fools flooding the market which makes it easier for whales to use their liquidations as fuel for a move to the downside. The timing was great, we saw this sudden media scare about COVID across the globe, we had options expiring this morning (just a few hours ago), it was a good move on the part of whales to take advantage of the market conditions suddenly flipping overnight. Not financial advice but I think the on-chain narrative still paints a more bullish than bearish market at the moment
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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.
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.