BTC and COIN Analysis
Bitcoin had an uppy weekend making about 10% gains since Friday and it’s up about 20% after dipping to a new low last Tuesday. Currently price is sitting at 35k and does have a potential daily W that will breakout at $35,517 on Bitstamp. The new low from last week did set the stage for potential bullish divergences that we’re now seeing in both RSI and MACD. If you’re familiar with TRi terminology you might even spot cheeky little bullish Davos in the indicators. If this W can break out and get going, we could see BTC heading back up to the top of the range. While it does look like a bottom is trying to come in and I can see why traders might be willing to step in on the long side, I’m also cautiously optimistic as the Reload Zone for the Fibonacci range drawn off last year’s Covid low is still quite a bit lower with the 61.8 Fib level at $27,181. If you’ve been following Brian for any length of time then you have probably seen how often price likes to test the RLZ. For BTC to come off this far from the top and so close to the RLZ it’s hard for me to believe that we won’t at least dip down into it before price can head higher. As an investor I will be waiting for daily chart RLZ levels before considering any serious buying. If you’re a bull and a more aggressive trader, hopefully you bought the dip over the weekend and are now riding your long.
Coinbase (COIN) is also a proxy worth looking at for a different look at Bitcoin price action. It’s looking strong today as it catches up to BTC’s weekend price action. I’m seeing price heading up into a potential head and shoulders neckline that suggests another pullback to form the right shoulder.Confirmation of this pattern would support Bitcoin bottoming here as well.
Unfortunately I’m not convinced we have a solid bottom in BTC or COIN, mostly because I really don’t like trade location here and think that we could certainly explore lower levels. That said, there is a potential W coming in that might push price higher in the short term. As always, be careful to manage your risk and mind your stops if you’re in here trading. At this level I think that price could go either way before deciding what the long term trend is going forward.
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