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Now that BTC failed at $10k, where do we go from here?

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@jrcornel
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Bitcoin failed yet again at busting through the $10k resistance level, what does that mean going forward?

The other day, bitcoin again made a run at busting $10k and again it was turned back shortly after.

This surge was a little bit different in that it broke well above $10k, getting as high as $10,400, before eventually being rejected all the way back down to the mid $9k's which was where that surge started.

What should we expect going forward?

Well, that all depends on how you interpret a chart...

The bearish scenario...

On the side of the bears, we now have 3-4 rejections at the $10k level, keeping bitcoin mostly going sideways while stocks continue to climb higher each day.

That is relative weakness as bitcoin had been trading along with stocks for much of this coronavirus pandemic.

Also, there is a possible head and shoulder pattern on the weekly chart (or triple top)...

Check it out:

(Source: https://bittrex.com/Market/Index?MarketName=USD-BTC)

This scenario would favor a move down to at least the $7,600 area.

On the bullish side...

On the bullish side there is a quote that I can't help but be reminded of as I mentioned the term "triple top" above.

And that is...

"Like a camera-shy Kardashian, there is no such thing as a triple top"

It was uttered by one of my favorite traders on CNBC's Fast Money, Josh Brown.

Meaning that as the price bumps up against a level that level weakens and price eventually busts through it, often on the 3rd or 4th test.

Which would indicate that the $10k level has been getting weaker and weaker with each test and currently we could just be resting before we make our next attempt at $10k and likely bust through it on our way to the $13k-14k area.

Which was the June 2019 high and represents the next resistance area.

Bearish and Bullish scenario all wrapped up in one...

There is also the possibility of an inverse head and should pattern playing out, which would be bearish in the short term but bullish in the long run...

Something like this:

(Source: https://bittrex.com/Market/Index?MarketName=USD-BTC)

In this instance we would see a similar dip to the one we saw in the bearish scenario that takes prices down around that $7,600 support area, but from there we would see a massive rally.

One that breaks that $10k level and likely never looks back.

I am actually hoping and thinking this one is the most likely scenario to play out.

There is also a CME gap at $7,600 which is yet to be filled and you all know how I feel about CME gaps... they tend to get filled.

So, if we do start to dip, don't get too depressed as it may represent a really good buying opportunity, possibly the last really good buying opportunity before a major bull market rally.

Stay informed my friends.

-Doc