Your Blazing Torch in The Dark Evil Forest! BITCOIN! (BTC)

Updated

Welcome friends and haters alike, to this update analysis on BITCOIN! Let's jump right in! Looking at the four hour chart, you can see that my hypothetical inverse head and shoulders pattern is playing out nicely. The right shoulder is nearly completed, and I've got to say, it feels good to see that my analysis holds true, illuminating the way like a blazing torch in a dark forest of evil naysayers who creep among the trees. Looking at the chart, we can see another positive sign, as BTC has just surpassed the falling dotted blue trendline (Breakout!) However, BTC still has some more overhead resistance to contend with. We have the dashed green trendline, which has been supportive for the majority of the run to the all-time high, we have the neckline of the inverse head and shoulders pattern, and we're still kind of flirting with the 78.6% retrace. The 50 EMA (in orange) has been surpassed, and that's something I want to talk about. You can see that BTC is beginning to breach the 50 EMA more frequently. This is decreasing the recent resistiveness of that level, so perhaps we will stay above it this time. I want to stress, however, (for educational purposes only) that we should never ever trade a pattern, until we actually see the breakout! A breakout above the black neckline is required, to complete the inverse head and shoulders pattern. The vertical dotted black trendline represents the target area of a rally equal to the full potential of the inverse head and shoulders pattern. In other words, a breakout of the pattern will likely result in a test of the top of the downtrend channel (in pink.) We're still working under a huge bullish divergence on the MACD, and we've just crossed over bullish above the zero line. If you look at the recent volume, it's also mostly composed of green bars, which confirms the momentum and the return of the bulls. The question now is, can the bulls follow through? A breakout above the black neckline will confirm the follow through. A failure, and subsequent decline, will be cause to reassess the development of this chart. Keep in mind, that head and shoulders patterns can occasionally retest the right shoulder. We are in a critical area right now, so we will have to watch closely to see how things develop. Good luck trading, everyone!

This has been your not-so-humble market wizard, droppin' knowledge like bombs in this place! Please follow, comment, like, and share on social media. Good luck trading everyone!

***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***

-MPC loves you-

-JD-

Note

As of right now, the current candle on BTC is breaking out, clearing all immediate overhead resistance. This is a technical breakout above the neckline, but we need to see a candle close above the neckline level. Keep a close eye on this action, and look for the close above.

Note

BTC has retreated from the neckline, and is now testing the 50 EMA (in orange.) Whether or not the 50 is supportive, will likely determine the a temporary outcome here. If it falls, it is possible that BTC could head lower, to retest the right shoulder. Support at the 50 EMA would be a bullish sign.

Note

It's like the market's saying "Hold up! Before we go breaking out of this inverse head and shoulders pattern, lets first see if we can find support at the 50 EMA — something we haven't been able to do in a long time."

MagicPoopCannon

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