Analyzing BTC trends using muli-plane grid techniqueTIP: Did you know that you can watch the price, volume and orderbooks (bids and asks) fluctuate on a bag of 10 different stable coins on our stable coin index @ vcdepth.io - This really helps to see when money is flowing in and out of the sidelines.
This chart depicts how I see trends and its applicable to almost any chart. I see an intersecting graph paper like grid with lines on different planes. Most of those lines I just copy and paste and move up or down. Here there are a total of 3 planes that provide the bulk of support and resistance for all the price action in this chart. Arguably there could be additional lighter lines on each plane in between some of the larger gaps. I tried to color each plane differently and emphasize the perceived strength of each line on its plane. Notice when price action occurs at the intersection of multiple planes, support and Resistance are usually stronger with combined support from the multiple trendlines, the more trend lines in support, the stronger the support. Furthermore I add Orange horizontal lines that depict horizontal historic support and resistance. The sharp descending channel we just broke out of appears to be a freefall and is now is trying to snap back to the grid.
From here there are 4 likely paths,
-The continuation of the sharp descending trendline, seemed the least likely, we have halted descent and broke the channel and have at least 3 planes of support with one of the other 3 paths are more probable. That said, we just broke all the supports while I was typing this, in support of this arrow. This path could see a low around $7800 as early as a week from now. This would most likely be a great entry point and the lowest we will see BTC for a long time.
-Continue along the bottom of what may become a large descending channel with an absolute low of $8000 possible mid-March. Right now this is definitely possible but it feels like one of the others may be more likely based on global order book support @ vcdepth.io
-There has been a decent amount of support and resistance sitting almost perfectly $1000 above the long term ascending trendline. This could hold and in fact could be bottom of a long term ascending channel with the top of channel sitting around $10k right now and also in a lighter red. If we are stuck in this channel we end up in the same place as the next option.
-There is a chance we take this little sub ascending channel to $9450 by mid-March where there is a large chance we will confirm this as a descending channel and likely follow it all the way down to the 5 year trend line before making its next big run to hopefully surpassing February highs with a low around $8400 mid-april.
*Note there is a chance if we drop to $8200 that we could form a nasty head and shoulders. Also watch all these lines, whichever direction we go from here, it will likely bounce between a set of these lines which can help identify entry and exit points.
This is not investment advice, do your own research!
