06 Nov Bitcoin Analysis: November 6, 2017
Here’s what I’m seeing on the chart.
Starting on July 16, 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 15, 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 1, 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 CryptoSyndicate a lot. There is a chance that the market can see a new ATH around next weekend, but this is uncertain at this point 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.