Bearish divergences galore on the daily BTC chart! For COINBASE: BTCUSD By MagicPoopCannon
Looking at the and , you can see that we are currently forming a divergence, as prices have reached higher peaks, but the and both reached lower peaks. Comparing that to what happened earlier this year, you can see that the indicators have also hit lower highs as BTC was showing higher highs, and that divergence inevitably led to a 55% correction. So if the 618 holds up as air resistance it will likely trigger another correction as predicted by these discrepancies.
Although there are also some indicators there, I lean more towards the side, especially if BTC cannot recover above the 61.8% retracement here on the daily. If it breaks this level and defines it as support, I might reconsider my opinion on the direction of the market in the near term. This would be especially true if the divergence trends were broken on the indicators. On the other hand, if we find here a failure for BTC to recover above the 61.8% retracement I think this will add to the evidence that suggests there is an ordinary bear market rally.
Many investors are blinded by the power of the crypto bear market rallies, only to be destroyed when the downtrend resumes. Rallies of 85% or more have occurred in every bear market in BTC history. However, the trend eventually picks up and prices drop dramatically. Just because we’ve seen a rally doesn’t mean we’re in a bull market. For this to become evident, we will need more evidence of an upward recovery, which starts with BTC recover above the 61.8% retracement. Additionally, there is still a death cross on the chart as you can see which does not bode well for the medium term view although the averages are converging. Overall, my short term view is that this rally is running out of steam and we will most likely come back down in the near future. This view could change if we see a build-up, but indicators are not currently pointing to a downward movement.
I am the card master, the teacher, the legend, the king and my name is Magic! Bye.
*** This information does not constitute a recommendation to buy or sell. It should only be used for educational purposes. ***