❗Parallel Downward Channel BTC❗
Updated
BTC has moved in a quite consistent parallel downward channel over the last few weeks. The top and bottom lines were tested a few times. The middle line marked the beginning of the channel and acted as a resistance and support line a few times as well. I've circled the times the price has bounced of those three lines.
If BTC stays within this channel we might face another significant drop to the 20'000 support area. I have never been an advocate of the 20'000 panic news but after seeing the channel I'm also starting to get cautious about this potential drop.
If the price continues sideways the price will hit the downward channel around the beginning of next week (13th June). I see two possible scenarios:
SCENARIO 1
The community manages to rally enough support to defend the BTC bullish trend and pushes the price through the channel at around 36'600. If that happens I would wait for confirmation to avoid a fake-out. After confirmation, the price is free to ascend to 40'000. There we will encounter another heavy resistance that was already established in late January 21. If sentiment is high we will also break through this resistance and could go to 70'000 or higher. However, it seems sensible to book some profit around the 40k area as a reversal is very well possible. If a reversal happens I'd assume that the previous resistance line of the downward channel could act as a support line.
SCENARIO 2
BTC does not break through the downward channel. If that happens we might well face a drop to 20'000. 20'000 is slightly above the previous ATH in 2018 and as a round number would be a strong support line. Beware that a fake-out might go slightly below 20k. However, as seen in earlier price movements (30'000 Low [May 19th] / 31'000 Low [June 8th]) round numbers seem to be preferred support lines for BTC.
Either is possible and entirely depends on the lean in of the community. I believe market manipulators are running out of steam and a bounce back is long overdue, but really anything is possible. Possible trade set-ups could be.
Entry: 30'000-33'000
TP: 39'000-41'000 if the price continues to rise sell in increments and adjust Stop Losses continually
Stop Loss: 29'000 (you can go lower, but if it goes below 30k it's probably gonna adjust quite drastically to the downward even if it temporarily bounces. In that case that 1% difference won't hurt much and reasonably manages your risk/reward.)
Not financial advice and for informational purposes only.
Due your own research.
Feel free to comment and like. I'd love to hear thoughts and suggestions for improvements. 😉
If BTC stays within this channel we might face another significant drop to the 20'000 support area. I have never been an advocate of the 20'000 panic news but after seeing the channel I'm also starting to get cautious about this potential drop.
If the price continues sideways the price will hit the downward channel around the beginning of next week (13th June). I see two possible scenarios:
SCENARIO 1
The community manages to rally enough support to defend the BTC bullish trend and pushes the price through the channel at around 36'600. If that happens I would wait for confirmation to avoid a fake-out. After confirmation, the price is free to ascend to 40'000. There we will encounter another heavy resistance that was already established in late January 21. If sentiment is high we will also break through this resistance and could go to 70'000 or higher. However, it seems sensible to book some profit around the 40k area as a reversal is very well possible. If a reversal happens I'd assume that the previous resistance line of the downward channel could act as a support line.
SCENARIO 2
BTC does not break through the downward channel. If that happens we might well face a drop to 20'000. 20'000 is slightly above the previous ATH in 2018 and as a round number would be a strong support line. Beware that a fake-out might go slightly below 20k. However, as seen in earlier price movements (30'000 Low [May 19th] / 31'000 Low [June 8th]) round numbers seem to be preferred support lines for BTC.
Either is possible and entirely depends on the lean in of the community. I believe market manipulators are running out of steam and a bounce back is long overdue, but really anything is possible. Possible trade set-ups could be.
Entry: 30'000-33'000
TP: 39'000-41'000 if the price continues to rise sell in increments and adjust Stop Losses continually
Stop Loss: 29'000 (you can go lower, but if it goes below 30k it's probably gonna adjust quite drastically to the downward even if it temporarily bounces. In that case that 1% difference won't hurt much and reasonably manages your risk/reward.)
Not financial advice and for informational purposes only.
Due your own research.
Feel free to comment and like. I'd love to hear thoughts and suggestions for improvements. 😉
Note
It seems that the news that El Salvador has accepted Bitcoin as an official currency has brought a positive upward move to the chart. The price briefly went above the 200-Day Moving Average line but quickly retreated below it.The question now will be if the positive sentiment is enough to push the price already to the top line of the channel, or if the bears are going to push it down again. In the case of the latter, a short-term reversed head and shoulder pattern could form.
Disclaimer
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