06 Nov Bitcoin Analysis: November 6th, 2017
Here is what I’m seeing on the chart.
Starting on July 16th, 2017, Bitcoin (BTC) had a great run and finally broke through the $3000 resistance line thanks to the NYA. BTC then pushed all the way up to $5000 on September 1st, 2017 before the major “China FUD” shook the market all the back down $3000 on September 15th, 2017.
This however was a perfect 0.61 Fib retracement which bounced beautifully off $3000 confirming that the prior resistance had now become support and kicked off BTC’s current monster run. Now yesterday BTC had a current all time high (ATH) that ended in a textbook doji which so far has been followed by a lower open and is likely looking to make a lower close; but traders still have half a day left.
If the current ATH from yesterday holds, which the RSI and MACD are indicating is likely, the markets can expect at least a 1-4 day correction and then reevaluate. But if the pullback takes until 14th it will line up perfectly with the short term trend line (see the image below: navy blue line) and I think it is likely that we can see a pullback to $6500 range which would be 0.236 FIB retracement as well.
However, the one thing that really bothers me is the September 1st, 2017 high of $5000 (image below: orange line), BTC broke through but has never retraced back to confirm support. Although BTC came close it didn’t actually make it back, it was too soon after the breakout to be considered a proper retrace to confirm support.
Right now, that line is sitting directly between 0.5 and 0.61, of the current run, but if this current pullback is a minor one, and over the next week we make a new ATH in the range of $8000, it will move the 0.61 line up directly on top of $5000.
In summary, BTC is currently pulling back and can expect to continue for the next 48 hours, how low the retrace goes will tell The Syndicate a lot. There is a chance that the market can see a new ATH around next weekend, but this is uncertain at the time, due to the trend we’re following. Exercise caution, greedy pigs get slaughtered first.
Either way we are expecting to see $5000 again before the end of the year.