Short and sweet this time. Well, maybe not so sweet. Last week I wondered if we would break out of the channel we were in at the time. and my expectation was that we would be rejected. We in fact broke out of the channel (briefly) only to get sucked right back in. Now in the same post I also mentioned that I believe that the horizontal Support/Resistance lines are a lot more valuable and that one did its job (so far). However, let's look at the channel first. The red dotted line was how I drew the channel last time. Now, you could argue that we broke out and are now testing the top of that channel and there is nothing I could say against that. Personally I think it is more likely that a new channel is forming, insofar as a 'channel' is really what matters most here. We will know in a few hours/days what interpretation is the correct one.
If I look at other indicators as Stochastic and RSI, I don't see a case for a strong move up, but I do see one for a bleed down, with possibly some acceleration.
If we take a look at the 3D chart from last week, we can see that BTC so far is more or less following the path I considered most likely. That path is consolidation within a trading range as indicated below.
Of course the descending triangle forming right now could break up (it really is a coin toss with those), but it doesn't seem likely. Also, we might finally see some common sense return to the legacy markets and I firmly believe there is a strong connection between the two.
So, the short I mentioned last week is still active and I added some to it when we broke up. It is a relatively small part of my trading capital, as any entry right now is risky. So, as always, I encourage you to trade safe, trade responsibly and wear a mask when you go outside!
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