So in my last analysis I was saying that bitcoin should go up to around 5k because of the big bullish triangle we were seeing on the chart. However now bitcoin face massive resistance and the 21 EMA (yellow line) will probably cause a pull back on bitcoin price... The price could drop as low as the 50 monthly SMA (red line) as you can see on the chart. That's actually what happened in the last bear market in 2015... The pattern could repeat.
Who will be providing the required selling pressure?
- The bulls that just made tons of money, are nowhere getting squeezed out of their positions, have more cash than before to take even more long positions, and can see that in the previous bear market an ever greater rally ensued after breaking that 21EMA? ;-)
- Or the bears that are out of funds or are about to getting squeezed even further?
We might see some small retraces and/or brief sideway actions (mostly fuelled by opportunistic day traders that do technical analyses, but probably also change direction as soon as they find out things aren't working), but I think this rally is far from over.
FrederickDupont
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@micmuc, If you read my text and look at my chart, I'm talking about a little retracement around 4.3-4.2k where we can see strong support now and maybe a little bit lower where the 50 monthly SMA is... If you look properly, in the previous bear market when the price touched the 21 monthly EMA (second yellow arrow), it acted as strong resistance and the price then dropped back to the 50 monthly SMA (red arrow) before to finally crack the 21 EMA months after... This could happen again now. However, I think the bottom is in and I don't think we are going back to 3k...
Wolong18
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Could you please draw what next if this opnion go that way?
FrederickDupont
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@thangblockchain, You mean what's next after bitcoin drop around 4k ?
- The bulls that just made tons of money, are nowhere getting squeezed out of their positions, have more cash than before to take even more long positions, and can see that in the previous bear market an ever greater rally ensued after breaking that 21EMA? ;-)
- Or the bears that are out of funds or are about to getting squeezed even further?
We might see some small retraces and/or brief sideway actions (mostly fuelled by opportunistic day traders that do technical analyses, but probably also change direction as soon as they find out things aren't working), but I think this rally is far from over.