BitcoinShort
Bitcoin Breakdown on the First Leg of a Wyckoff Distribution
Always interesting times in the world of Bitcoin. My hope is that regardless of what Technical Analysis you use, either you were positioned short or sold at the top before the 3% correction earlier today.
For about the last 16 hours or so, the 4H Intraday chart has been reflecting a price pinned beneath the upper trendline on increasing volume, while the lows have been pinned around $9,600 indicating a strong move was imminent. The failure to break the $9,840 price level on heavy volume signaled insufficient buyers in the market to push the Bitcoin price higher into breakout, sparking the first leg of the Wyckoff Distribution. Sometimes those bags can just get too heavy.
The Intraday chart reflects a low price target of $9,260 should have been realized [$9,860 - ((($9,860 - $9,560)*3)*2/3)]. In the end the bottom part of the new trade range was discovered at $9,300 or $40 above the target price, which is well within the delta I’ve experienced using the Vertical Count Method in Point and Figure. Also, $9,300 is a significant psychological support level.
Once the breakdown went beyond $9,500 (three boxes below the prior low), a Low Pole Warning was signaled. A Low Pole Reversal generally results in a 50% retrace in the breakdown range from the prior low ($9,560) to the bottom of the breakdown ($9,300), which would have targeted a retrace to the $9,440 level. The Low Pole Reversal realized the $9,440 price target, stalled, and then pushed higher as shorts covered their positions.
We are currently seeking the upper end of the new 4H Intraday trade range. I speculate it will be around the $9,540 level.
If we look at a higher timeframe (1D) , the most recent high topped out at $9,940 which was the same level as the Secondary Test of the upper range of this Wyckoff Distribution. A double top (which is Bullish in Point and Figure) was formed which broke the upper trendline of the formation, suggesting bullish bias and the Parabolic SAR flipped bullish as well.
While the signals all reflect bullish sentiment, I feel we will more likely test the lower end of the trading range ($8,120) and establish a Sign of Weakness (SOW) somewhere between $8,120 and $7,700 before retracing to the upper end of the trading range ($10,060) and possibly hitting $10,300 in a final Upward Thrust before completing the Wyckoff Distribution Phase.
Happy Trading.
For about the last 16 hours or so, the 4H Intraday chart has been reflecting a price pinned beneath the upper trendline on increasing volume, while the lows have been pinned around $9,600 indicating a strong move was imminent. The failure to break the $9,840 price level on heavy volume signaled insufficient buyers in the market to push the Bitcoin price higher into breakout, sparking the first leg of the Wyckoff Distribution. Sometimes those bags can just get too heavy.
The Intraday chart reflects a low price target of $9,260 should have been realized [$9,860 - ((($9,860 - $9,560)*3)*2/3)]. In the end the bottom part of the new trade range was discovered at $9,300 or $40 above the target price, which is well within the delta I’ve experienced using the Vertical Count Method in Point and Figure. Also, $9,300 is a significant psychological support level.
Once the breakdown went beyond $9,500 (three boxes below the prior low), a Low Pole Warning was signaled. A Low Pole Reversal generally results in a 50% retrace in the breakdown range from the prior low ($9,560) to the bottom of the breakdown ($9,300), which would have targeted a retrace to the $9,440 level. The Low Pole Reversal realized the $9,440 price target, stalled, and then pushed higher as shorts covered their positions.
We are currently seeking the upper end of the new 4H Intraday trade range. I speculate it will be around the $9,540 level.
If we look at a higher timeframe (1D) , the most recent high topped out at $9,940 which was the same level as the Secondary Test of the upper range of this Wyckoff Distribution. A double top (which is Bullish in Point and Figure) was formed which broke the upper trendline of the formation, suggesting bullish bias and the Parabolic SAR flipped bullish as well.
While the signals all reflect bullish sentiment, I feel we will more likely test the lower end of the trading range ($8,120) and establish a Sign of Weakness (SOW) somewhere between $8,120 and $7,700 before retracing to the upper end of the trading range ($10,060) and possibly hitting $10,300 in a final Upward Thrust before completing the Wyckoff Distribution Phase.
Happy Trading.
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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.