After two failed attempts to break the 10.000 resistance, the price got rejected quite hard and a correction to the downside was inevitable.
What we see here is that the price is now forming a falling wedge bullish reversal pattern, indicating the sellers are slowing down, which usually happens right before a bounce.
There are now new resistances formed above, which were old supports that got broken. We will use those as the targets for this move.
The fact that there will be a bounce does not mean that it's going to make it all the way up to 10k again though. It is possible, yes, but for now, I see it more as a natural corrective wave upwards, after a big fall. If the momentum picks up, and the move up becomes strong and sustained, then yes, 10k, and even my old target of 10200-10400 is in cards. But let's not get ahead of ourselves for now.
The confirmation for this trade is the breakout of the wedge.
Targets:
1. 9340
2. 9470
3. 9587
4. 9749
As always, lock in partial profits at each of the targets, since the price may reverse at any of the resistances above.
What we see here is that the price is now forming a falling wedge bullish reversal pattern, indicating the sellers are slowing down, which usually happens right before a bounce.
There are now new resistances formed above, which were old supports that got broken. We will use those as the targets for this move.
The fact that there will be a bounce does not mean that it's going to make it all the way up to 10k again though. It is possible, yes, but for now, I see it more as a natural corrective wave upwards, after a big fall. If the momentum picks up, and the move up becomes strong and sustained, then yes, 10k, and even my old target of 10200-10400 is in cards. But let's not get ahead of ourselves for now.
The confirmation for this trade is the breakout of the wedge.
Targets:
1. 9340
2. 9470
3. 9587
4. 9749
As always, lock in partial profits at each of the targets, since the price may reverse at any of the resistances above.
Note
First target reached. Nice breakout. We might see a small pullback to around 9250-9270 now.Note
And a pullback to 9260 happened, this is now second attempt to break higher, however, it needs more power, and it is unlikely to be able to get it from here. A slightly larger pulback down to around 9200-9180 area would be ideal (and is likely) from here (9290).Note
The price is entering a miner support area now. Watch for signs of reversal from here down to around 9170-9180. This would be the pullback I mentioned above.Note
Looks like that was the bounce. Quite a shallow pullback, but still possible.The volume is still not satisfactory, bit it may follow.
Note
Although things may seem bullish right now, this wedge is something to keep in mind. If this move stops around 9400, not succeeding to push higher, then this wedge will very likely materialize, which could take the price back to 9040 again (as a first target).Until then, this should push at least to 9400. If it breaks higher to the targets I wrote above in the original chart, then the wedge is invalidated, and we might see a larger move.
Note
Careful here. If this breaks down, and 9200 doesn't hold, the target of this wedge is 9050.Note
Bounced off of the wedge support line once more.Let's see how the price reacts at 9415-9425. If it breaks through that area with a strong push, the wedge goes out the window, and the price is likely to go higher. If it gets stopped there and reverses, then what follows is probably a break of the support downwards.
Note
We now have a bigger rising wedge (the one you see above), and a smaller rising wedge inside it.Small one has the target of 9240.
Big one has the target of 9050.
So far, bearish side is stronger, but still lacks volume and a real decisive move.
Note
You've been warned. :) This is quite a strong candle. And it doesn't look like a pullback anymore, but a possible start of something bigger. Let's see.First target of the wedge at 9200 reached, and sliced through it like it's nothing.
That bigger wedge has the target of 9050.
Note
Target 9050 of the big wedge has been reached too.It could consolidate here a bit. A dead cat bounce up to 9150-9180 might happen sometimes within the next 2-3 hours (if the price doesn't drop below 9000), but so far, things are looking quite bearish.
Note
Touched the main support zone on the chart. We should see a small bounce from here.Note
RSI isn't very useful in trending big impulse waves such as these, but the only thing it does show is when the bottom (at least temporary) is near. It shows that through the divergence that appears. In this case, we have a bullish divergence forming.The price made a new low, but the RSI failed to make higher low, indicating sellers exhaustion.
If this materializes, we should see a bounce from here. The momentum is still heavily bearish, so don't expect any major reversals yet (possible, but still not likely). However, we could see a bounce to 8580-8620 area, even 8700, depending on how strong the bounce is.
On the downside, there is a very strong support zone (green area which we already entered) from 8400 down to 7800. The stronger levels are 8200, 8000 and 7800. Keep those levels in mind for signs of a bigger reversal, in case we see it.
Note
*the RSI failed to make a new low, and made a higher low instead (made a typo above).Note
Falling wedge (bullish), and contracting RSI going into squeeze slowly. This will produce a move within 2-3 hours max. This wedge is a sign of a potential bounce to 8550-8600 coming, as long as it doesn't break to the downside (which could happen if the market is extremely weak, and right now it is).I'd say 60% bullish bounce to the targets I mentioned, and 40% sideways for 2-3 hours then continue the drop down to 8180-8100 to start with.
Ideal buy zone would be in the 7800-7950 area (with signs of reversal of course).
Note
Broke out of the wedge. First target of the wedge already reached. Second (max) target is 8634.Note
It hit 8633 before slighlty retracing. (missed it by one point) :)The momentum is still good, and the next resistance is at 8700-8730.
Note
Looks like the 8633 target I gave above was the actual local top. We might be seeing another wave down to the main suport area at 8100-7800. Unless it bounces from 8300. If it closes below that, highly likely the next move down has started.Note
8300 support broken down. First target 8000, second target 7770-7800 zone.Trade closed: target reached
The first target of this (main) chart was reached (9342). The sub-targets in my updates later were also mostly reached (bearish targets of 9200, 9050, then subsequent bullish target of 8633).I've posted a new analysis for the next potential move, and you can find it here:
Related publications
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.
Related publications
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.