Weekly candle just closed with a hammer and 2 candles before was a dragonfly doji. It seems to have little effect on price action as this market continues to confuse nearly all traders / investors.
The most likely trend for next couple weeks is sideways chop until a test of the purple trendline occurs - likely later in August or by early September.
Jackson Hole will occur August 11th with the Fed to likely bring up tapering once again which will happen before any interest hikes occur later in 2022. Market will likely get spooked around the Fed language leading up to the meeting- b/c markets are not efficient and haven't priced this in yet even though it was pretty blatantly obvious the Fed was going to eventually taper bond purchases.
Regardless, the bond market is signalling deflation NOT inflation is ahead unless the Fed continues its bond purchases and low interest rate campaign. Notice yields on the 10 year treasury (the risk free rate) have fallen - a sign that we are headed for deflation.
Low interest rates believe it or not, even though they are pricing in deflation, are also good for ZERO yielding assets like BTC and Gold b/c they compete for the same dollars. Notice Gold is reacting favorably to the move in interest rates.
Finally - even though I'm not the biggest advocate of a correlation b/w BTC and DXY it does seem there has been an influence lately that when the DXY has weakened, BTC has reacted favorably in the last few weeks. It will be wise to watch the DXY in the coming weeks for coming clues.
Overall we are still in a bullish structure despite the naysayers. $30k is a crucial line in the sand that to date has held up well as support.
Also, notice the 20, 34, 55 weekly EMAs are still in the right order and in a bullish structure. Price continues to hover b/w the 34 and 55.
The next major bullish level to take will be
42K which likely won't occur until the purple trendline is broken imho.
The ghost bar pattern is from December 2018 and just offers a potential clue on how BTC could trend before breaking the trendline - a test will come sooner or later.
The most bullish scenario is if a hash ribbons buy signal prints before breaking the purple trendline imo. With hash rate coming back online with miners turning back on after moving out of China, this could come in the next 60 days.
The most likely trend for next couple weeks is sideways chop until a test of the purple trendline occurs - likely later in August or by early September.
Jackson Hole will occur August 11th with the Fed to likely bring up tapering once again which will happen before any interest hikes occur later in 2022. Market will likely get spooked around the Fed language leading up to the meeting- b/c markets are not efficient and haven't priced this in yet even though it was pretty blatantly obvious the Fed was going to eventually taper bond purchases.
Regardless, the bond market is signalling deflation NOT inflation is ahead unless the Fed continues its bond purchases and low interest rate campaign. Notice yields on the 10 year treasury (the risk free rate) have fallen - a sign that we are headed for deflation.
Low interest rates believe it or not, even though they are pricing in deflation, are also good for ZERO yielding assets like BTC and Gold b/c they compete for the same dollars. Notice Gold is reacting favorably to the move in interest rates.
Finally - even though I'm not the biggest advocate of a correlation b/w BTC and DXY it does seem there has been an influence lately that when the DXY has weakened, BTC has reacted favorably in the last few weeks. It will be wise to watch the DXY in the coming weeks for coming clues.
Overall we are still in a bullish structure despite the naysayers. $30k is a crucial line in the sand that to date has held up well as support.
Also, notice the 20, 34, 55 weekly EMAs are still in the right order and in a bullish structure. Price continues to hover b/w the 34 and 55.
The next major bullish level to take will be
42K which likely won't occur until the purple trendline is broken imho.The ghost bar pattern is from December 2018 and just offers a potential clue on how BTC could trend before breaking the trendline - a test will come sooner or later.
The most bullish scenario is if a hash ribbons buy signal prints before breaking the purple trendline imo. With hash rate coming back online with miners turning back on after moving out of China, this could come in the next 60 days.
Note
We're 61 days into this phase since the selloff began and are 37% away from the purple trendline.The very similar 50+% selloff that happened in Nov 2018 and lasted until April 2019 was nearly 53% away from its respective downtrend line drawn from the peak of the selloff:
Note
Considering it took 139 days from Nov 2018 to April 2019 to get out of the downtrend during a bear market and that at the same point in time (61 days in), it was further away from from downtrend line than is the current selloff tells me BTC will do a couple things - first it will continue to trend sideways just like the 2018/2019 selloff did and the current selloff will likely not last AS long (139 days) since it was further away from the frendline, 53% vs. 37% today.Lets just say it's 100 days to get out of the current downtrend, considering a) we are still structurally in a bull market and b) we are not as far away from the downtrend line - this would put us at the middle to end of August to surpass the purple downtrend line at $40k:
Note
Just like the 2018/2019 selloff we will likely print a hash ribbons buy signal before we exit above the purple downtrend line - VERY intersting to point out - it took 73 days for the hash ribbons buy signal to print from the first capitulation circle in the 2018/2019 selloff. If we measure 73 days from the point of the capitulation circle that occurred on June 3rd - this would create a hash ribbons buy signal on August 15th (near the same day I estimated earlier at 100 days since the selloff began to exit the downtrend line)... let's keep watching
Note
Another positive note - the tightening of the daily EMAs is structurally positive as when BTC retests the trendline or rises even somewhat to the high $35-$38k range, we will get some bullish crosses on the daily EMAs for the first time since the selloff began.There is of course a risk of falling lower as everything in investing is a probability but as long as the $30k and $28k levels hold, we should continue to trend sideways.
One thing to note is that the shorts have piled in again recently - let's see if this leads to a price decline or if it's the shorts being overly confident.
Note
Another thing to note which I've kept in mind and haven't forgotten is that the Google Advertising ban is released in August which means billions of people will have really professional, better quality advertising reaching them from companies like Coinbase, Binance, etc... this brings an air of prestige and quality and will imo bring back optimism into crypto. The criteria if you remember is that the companies have to be qualified in order to be able to advertise so we shouldn't see so much of the scammers and low quality ads that makes crypto look cheesy and scammy to the newbie.
Note
Google Will Let Crypto Wallets Run Ads; ICO Ads to Remain Bannedbloomberg.com/news/articles/2021-06-02/google-will-let-crypto-wallets-run-ads-ico-ads-to-remain-banned
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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.