BTC - Another Potential Bearish PatternHere I present my second alternative for a Bearish case for Bitcoin.
Per my previous posts I explain in detail the interest in recollecting liquidity in these lower zones. Previously I presented pathways to the uber lows at 7,000-10,000 - however this is another possible case.
I believe Bitcoin can see a drop from 109,200 straight down to 19,000-20,000
Why?
1. Major Volume support at this level
2. Major liquidity pools in confluence with this level
3. Price would form a W bottom with a higher low - which aligns with DXY breaking down on the monthly time frame. We can use DXY to project a bull market spanning 2-5 years (weakening dollar = more interest in deflationary assets such as Bitcoin)
4. Per the note above, it’s unlikely that BTC continues straight up without a sharp drop. The way this market works is to a large degree with leverage trading. The market and exchanges desperately want to shake out these longs, especially if we consider a 2-5 year bullish forecast through a macro view.
5. Confluence with this diagonal trendline which shows a clear support / resistance structure (note the Bitcoin chart is formed via diagonal ascending support and resistance lines - we can demonstrate this clearly and repeatable by duplicating the correct trendline and seeing how it forms the chart at any location)
Personally, I am shorting Bitcoin from 109,000 - and am expecting to see a fast drop through the rest of the weekend.
I will watch what the price does, where it reacts and interacts, and attempt to get a head start on understanding the true bottom before this “true” bull cycle begins.
Happy trading
