Being contrarian is fun
Sometimes I wonder if I am entirely normal. Probably not and maybe that helps when you try to make sense of what is generally a market that seems to suffer from manic depression. It is mental health awareness month after all, so let's show Bitcoin some love, shall we?
This week I would like to start with the shorter, 12hr timeframe. I have one rule, which is never to bet against the 12 hr Stochastic. That doesn't mean that you should always bet in favour of it, but as a general rule, if the Stochastic is this low, at least short term, I would not expect a big decline. Famous last words, probably...
I have even made two bold 'pattern assumptions'. One is that we may be forming a symmetrical triangle, which will be more likely if we break out of the descending wedge bullishly. When I look at Crypto Twitter, I see all the regular bulls turning bearish, so in my experience that is a perfect moment to become contrarian.
Does that mean I believe we go to the moon? Well: no. Short term we might have a run up to 94/95 but I am not sure we are ready for more. For that we need to look at the weekly.
Ouch.... That is one hell of a resistance we need to break. Personally, I doubt we will break that 'trend line' so close to another big resistance level, namely 10K. It just seems more likely to wait it out, let the summer pass, see how the corona / economic situation develops before big players will attempt such a bold move. I think our ambitions for the next weeks should be set accordingly.
However (and I say this with extreme caution), if I look at the monthly I see 3 things.
First of all, we seem to have been bouncing off that bottom line of a Trading Range with some aggression. Look at that wick for March... Secondly, even though April was already very bullish, May did not bring a correction. In May, we are, for now, still going up, even though we are close to one possible resistance, depending on how you would draw the TR. And lastly, we see the 9 EMA/MA crossing bullish again. Possibly. A big correction down could still mess that party up, but so far it looks like we found support there.
So, have I turned into a 'to the moooooooon' groupie all of a sudden? No. Not really. I still have my doubts about a rise in this economy and about crypto in general, but if I wanted to own some of that sweet, sweet bear money that is for grabs just over 10K, now is a perfect technical moment to f*ck with them. I would be careful playing either position, but a well managed long might be something I could be tempted by. Risk management is however much more important than crystal ball analyses. So, as always, trade safe and have a good week!
BTSE regularly hosts the technical analysis of experienced BTSE traders. Please note that we neither endorse any analyses published nor give you financial advice. Please make any trading decisions based on your own research. Our aim is to create a platform that offers you the most enjoyable trading experience. If you have questions or suggestions, please don’t hesitate to reach out to us at email@example.com or DM us on Twitter: @BTSEcom.