Vladimir DENIS

@vdenis156

Technical analysis of Bitcoin 06/09/2019

Technical analysis of Bitcoin 06/09/2019

A new week begins for Bitcoin and our dear crypto-currencies (it started yesterday to be exact, sorry!) while the future contract gap of nearly 4% at the opening. Analysis.

To start, let’s look at the weekly to get an idea of the closing candles and the general feeling of the market.

First observation, the candle in reversal configuration, here a doji with a very long high wick, has still not been broken. I was already warning you that in my opinion, we had found our “glass ceiling”. The area we are currently working on is a range zone, the market has still not made its decision (although we broke a nice compression triangle from above yesterday, hence my analysis today).

One point is interesting: during the last week, a lower low has been marked, while to my great surprise, there was no support on this area, the support being much lower. The resumption of prices and the rise that followed surprised me… It was only after the fact that I noticed the similarity: last week’s low fuse perfectly coincides with a 38.2% retracement of all the previous crack, and also coincides with a retracement of the same Fibonacci level but of the whole uptrend.

The market, after having broken the 38.2% retracement of the previous crash without blinking, comes to make a pull-back on this level. It is also a Fibonacci retracement of the bull-run of recent months.

The area we are currently working on is clearly a question zone: will BTC have the strength to go higher, offering us an even deeper retracement of its crack, or will it be blocked by powerful sell-hands? I think, as many of you will, judging by the social networks, that we are in indecision zone.

The figure formed by BTC in recent days is clear.

BTC here in 2H forms a shoulder head shoulder and breaks his neckline. The decrease in volumes on each bear attempt is what we are looking for on this type of configuration. The graphical objectives are therefore around $14,600. But this area is not a technical area and I would therefore not favour this possibility, although it should be noted. I think that one must always interpret the ”logic” of a chartist pattern, however beautiful it may be, before considering it valid.

To be perfectly honest, many beginners and individuals got trapped with this pattern which is the queen of chartist pattern: it is often invalidated, and the technical target (the distance from the neckline to the head, reported to the breakout of the neckline) give us objectives much higher than the resistance of the $13,700 we found, and I doubt we will get away with it. However, we will note this possibility and it will be our first objective in the event of a break from the highest.

In a short term perspective, I would say that we have come to look for the Fibonacci retracement level of 76.4% of the range and that sales are eventually possible: they will, however, have to be secured quickly since we are in a range.

Here in H2, I think small sales are possible while staying wide enough on the stops!

Let’s summarize:

*For the Bears:

–> A large weekly reversal candle whose high point has not been damaged, but a low point that has already been broken.

–> Bitcoin appreciated by nearly 330% in an almost straight line (which, once again, does not suit to an end-of-crash pattern) and only 30%, or less than 10% of its last run.

*For the Bulls:

–> A support was found on the retracement level of 61.8%.

–> Last week was bullish, and the beginning of the week is also up.

–> Bullish pattern (inverse H&S).

So we are neutral for the moment: in range. Nevertheless, I remain bearish in daily and still think that we will not break the highest point of the range-structure (the $13,764 on Bitfinex) and that we will eventually move towards phases of declines. However, if the range structure were to be broken and we went higher, we would have to aim for a deeper retracement of the crash and the last Fibonacci level (76.4%) is around $16,000. In that case, I’ll try again to short-sell on this level.

For the time being, all we can say is that we are waiting for new information.

However, be careful about your exposures: if we really have found our top and the market is ranging before falling, the drop phases will be dynamic, long and probably deep.

Bulls, it’s your turn. Why don’t you show us that we’re still bullish?!

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