It’s been a long week, so I apologize if this analysis comes out a bit disorganized. Anyway, I’m not saying that a move up WILL happen here. In fact, I do my best not to speak in absolutes, since the world is always changing. What I do know is that it can pay off to prepare for the unexpected, and it can especially pay off to do the exact opposite from what the herd is telling me to do. I’ve seen many analyses recently calling for a violent breakdown. Bears seem fairly euphoric as well, with the fear/greed index lingering at historic lows for the longest period in this market’s history. And indeed, Bitcoin has broken down from the small channel I’ve been watching AND my purple trendline. Shorting seems very obvious here, as every $1000 level is quickly become resistance. It’s almost too obvious. And is now increasing. My own personal sentiment is the opposite of how it was when Bitcoin was above $60k.
On my Gemini chart, there is a trendline which shows that Bitcoin can also head slightly lower and produce a failed low. A breakdown below that trendline could also present the same target I have on Coinbase – near $24-25k.
Based on this, if we are to see continuation this week, I expect Bitcoin to drop towards the mid-low $20k’s. There is a secondary purple trendline on my Coinbase chart, where I’ve placed a red X for a potential reversal zone. Price can drop even lower than that and recover back above the trendline. Perhaps we really do need to see another “panic low.” But on the side, I am still holding out for a test of mid-$40k’s, so I set a target at the important $46k level. If Bitcoin is to resume a , I believe it first needs to break and hold $46k convincingly for several weeks. Below is what I’d expect to see, if we somehow get continuation later this year. Something like this can also occur with a brief test of the lower purple trendline
Taking the uncomfortable trade is to buy at these levels. It genuinely feels bad. I’ve done it several times over the last couple months, and even added a little more today. I am prepared to add lower if necessary as well. I also acknowledge my mistake in not reducing risk when the market was at higher levels (though I’m still well in profit, since purchasing during the last bear market). This is an adventure for me, and a good lesson to learn as a young adult. I recognize the possibility that crypto valuations collapse as a result of too much leverage in the system––my most recent post is about this. I am still leaning towards reducing some risk at the $46k level, if we get there.
This is not financial advice. These are just my thoughts, and they should be used for speculation/entertainment only.
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