SNGLS/BTC Long term bullish (Short term major profit potential!)What's up world!? Welcome to this update analysis on Bitcoin! Let's get right to it! Looking at the four hour BTC 0.75% chart, you can see that the breakdown that would complete the pattern in BTC 0.75% has not occurred yet. Instead, we've had an extended consolidation sideways, after the second spike.
As a refresher on the pattern that I've been covering, I'll walk you through it from the beginning. On the left middle of the chart, the pattern starts with a bear flag which produced a spike down (pink arrow,) followed by a rally above the 50 EMA (purple arc,) followed by a bear flag that dropped below the 20 EMA (in blue.) From there, we saw a spike back above the EMAs, and then a big drop before the pattern began to repeat itself.
Looking at the current action, you can see that it's nearly identical. However, we're now seeing a longer consolidation after the second (spike). That doesn't necessarily mean that the pattern has failed. It just means that it's changing a bit. As you can see, the bulls tried to rally above the 50 EMA (in orange) but that rally was quickly reversed, showing continuous technical weakness in this market. So, there is a possibility that a considerable drop is still right around the corner, which will complete this pattern. Personally, I still think there is enough technical evidence to support a continuation of this pattern, even though it has produced an extended consolidation after the spike. As I said before, patterns like this can end unexpectedly. That's something that I've discovered, while following patterns like this over the years. But I've also learned that they can morph slightly, while maintaining the same general repetitions. You can see that the bear flags aren't identical, but they are there nonetheless. So, yes, the duration and magnitude of the movements isn't perfect, but the structures are nearly identical, and that's what I'm interested in. With that said, I'm still looking for a move that takes us lower. Specifically, I think there is enough technical weakness to result in a breakdown below the neckline of the head and shoulders pattern (in red.) Below there, Bitcoin 0.75% could really begin to accelerate to the downside.
As you can see, there is a support level at 6000, which extends from the low made on 2/6. That will be the exact double bottom low, but I don't think it will be reactive enough to reverse this market. It is possible that we get a small bounce from there, but I think the most likely scenario, is that we don't react to it much at all. At most, I could see a bounce off of 6000, that causes BTC 0.75% to retest the bottom of the neckline from the head and shoulders pattern. From there, I would expect to see a horrific failure, and a continuation selloff, followed by a bounce off of the 7972 area, and then a drop to about 4250. I've drawn what that could look like, with arrows on the chart. Additionally, I believe that we have just created a new downtrend channel (dashed channel.) So, look for any rallies to be capped by the top of this channel.
PS. Bitcoin 0.75% is forming a bear flag .
I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
-Magic loves you-
-not JD-
