The market is a little bit spooked as we approach what is likely the final stages of this downtrend.. testing the nerves of the remaining traders in the market. Keep in mind that even as Bitcoin dropped, it still it is respecting some lesser support levels. That said- we remain in a downtrend and those supports are downtrend supports.
I think we have one of three possibilities that will play out, but I still am leaning macro bullish in the near future. Why, you ask?
Supply flying of exchanges even faster today than last week. Top 10 wallets continue scooping up coins in this range. Historical trends of bull/bear cycles suggest an impending reversal, and various other indicators are approaching their optimal buy zone, like Net Unrealized Profit/Loss (NUPL), Network Value to Transactions, and more investors continuing to HODL (at multi-year highs despite price) which adds to the growing supply crunch narrative.
But yes the Russian news, ETF rejection.. provide a convenient backdrop to shake the market a little and see if a few longs can be scared off, maybe get a discount in Bitcoin.
Scenarios:
1. A temporary relief rally feels long overdue. Maybe a run to at least $42k before more downside. I could see a wick higher, perhaps a fakeout in this case to like $45k before dropping.
2. A reversal and bullish rally from the 3.5 month downtrend. We will want to see a close over around $42k here, but mid $40s would be better. The magic number where I feel comfortable with bulls likely in control is around $47k, which would place us above key resistance including the 20/21w MA support band.
3. More downside. I think the signal here is if we drop below the supports identified on the chart. There are a few diagonal supports, and of course the psychological support at $40k. Below there I'm watching $39.6k, around $37.5k, $36k, and $34.5k. A close under $34.7k will likely lead to more downside since thats a break of structure and the support level from September.
As stated above, I suspect 2 as the most likely, closely followed by 1, and lastly is 3. Best of luck and trade safely in these exciting times.
I think we have one of three possibilities that will play out, but I still am leaning macro bullish in the near future. Why, you ask?
Supply flying of exchanges even faster today than last week. Top 10 wallets continue scooping up coins in this range. Historical trends of bull/bear cycles suggest an impending reversal, and various other indicators are approaching their optimal buy zone, like Net Unrealized Profit/Loss (NUPL), Network Value to Transactions, and more investors continuing to HODL (at multi-year highs despite price) which adds to the growing supply crunch narrative.
But yes the Russian news, ETF rejection.. provide a convenient backdrop to shake the market a little and see if a few longs can be scared off, maybe get a discount in Bitcoin.
Scenarios:
1. A temporary relief rally feels long overdue. Maybe a run to at least $42k before more downside. I could see a wick higher, perhaps a fakeout in this case to like $45k before dropping.
2. A reversal and bullish rally from the 3.5 month downtrend. We will want to see a close over around $42k here, but mid $40s would be better. The magic number where I feel comfortable with bulls likely in control is around $47k, which would place us above key resistance including the 20/21w MA support band.
3. More downside. I think the signal here is if we drop below the supports identified on the chart. There are a few diagonal supports, and of course the psychological support at $40k. Below there I'm watching $39.6k, around $37.5k, $36k, and $34.5k. A close under $34.7k will likely lead to more downside since thats a break of structure and the support level from September.
As stated above, I suspect 2 as the most likely, closely followed by 1, and lastly is 3. Best of luck and trade safely in these exciting times.
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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.