Bitcoin - The dump before the massive pump !!!By now a lot of traders and investors are very nervous about Bitcoin's next move, and justifiably, I don't think many people saw this particular setup coming, although it is normal for Bitcoin to have such volatility.
However, In the above chart, we see a particular situation which could present itself with various moves and targets. This is combined with a possible Black Swan event (meaning large scale military conflict) or even significant loss of confidence in the petro dollar, due to external influence such as BRICS and the mere fact that the USA is printing more $$$ into their way into oblivion and hyper-inflation. Why does it matter if the USD takes a hit? Unfortunately at this current point in time, Bitcoin seems to be +80% correlated with the S&P500.
Thus, we are at a critical point in the market where, based on previous price action (chart history) and some issues that have affected and/or will affect the market, we now have 5x Potential targets as follows:
Target #1 = Daily FVG+OB: Range between $57,736.05 to $59,535.00
Target #2 = Daily Gap: Range between $45,288.65 to $46,800.00
Target #3 = Daily Gap: Range between $44,396.50 to $45,242.12
Target #4 = Daily FVG+OB: Range between $43,399.98 to $44,331.10
Target #5 = Daily FVG+OB: Range between $40,300.24 to 41,394.34
Target #1 is where the current price is centered inside a DAILY FVG + OB. This would be the optimal reversal point, however going by my Level count, we are still in Level 2 which means an inevitable drop again to a lower price point, either within the Lower FVG+OB range between $52,088.00 to $54,476.47 or to one of the lower targets #2 through to 5. My guess is there will be another dump, either due to some financial issue or possible military action in the Middle East or Ukraine. I labelled this as Possibility #1 in the chart above.
Target #2 is where price action could come down to one of the Daily Gaps and then reverse. I see this as a low probability move, especially due to the fact that Bitcoin has an irritating habit of retracing back to 98% of it's previous high.
Target #3, again, could come down to one of the Daily Gaps and then reverse.
Target #4, is a high probability reversal point where due to the Daily FVG + OB being where most of the liquidity would be held, seems the most logical target before a solid reversal. I have labelled this as Possibility #2.
Target #5, is a high probability reversal point due to the Daily FVG+OB as well as it being at the 98% retracement point that Bitcoin seems to so often follow. I have labelled this as Possibility #3.
Therefore at this point in time, due to the many issues currently under the microscope together with potential conflict escalation in the Middle East and/or Ukraine, and the level count showing a level 2, I see it highly probable that the current boxed reversal zone will be invalidated and we will achieve a much lower reversal point more than likely between Possibility #2 and Possibility #3.
Note that I am still very bullish on this, even though the DAILY EMA shows BEARISH trend, it is only temporary as the WEEKLY EMA is still very much BULLISH !
I shall update when price action reveals more useful information.
