BTC - Descending Trendline= Strong Barrier for Bulls to Overcome
Hello Traders, here is my analysis for BTC/USD.
Let me start off by saying, BTC has a massive barrier to overcome to turn bullish.
What is this barrier I speak of?
***The Descending Trendline that been plaquing BTC since the November 2021 high.
What does this mean for BTC?
- Basically, this trendline is MASSIVE MASSIVE Resistance for BTC and will require a valiant effort from the bulls to overcome.
Is it possible for the bulls to break through this trendline?
- Of course, but highly unlikely.
- Eventually this trendline will break, but under the right economic conditions.
What type of economic conditions?
- Right now the markets are panicking, especially after the economic data that came out yesterday. We are currently in what is considered a "Risk-off" environment where larger traders and smart money consider it too risky to trade asset classes like crypto or volatile stocks.
- BTC will need to be in an environment where the economy is showing signs of improvement for a stable period of time, bringing larger investors back into play in the riskier assets such as BTC and crypto.
- Keep an eye on the stock market, BTC is highly correlated with stocks such as the Nasdaq, SPY and right now even copper. Once The broader stock market turns Bullish, look for BTC to turn Bullish.
Onto the actual analysis...
- Like I said, the descending trendline is going to act as major resistance, so from a trading perspective we know that...
1) The upside is limited (to that trendline)
2) The trendline could make for a good shorting opportunity
3) If price does end up breaking the trendline, thats extremely bullish for BTC and we can change our opinion form bearish to bullish.
What's likely to happen in the short term?
1) BTC will most likely retest the descending trendline
2) BTC will get rejected off that trendline and inevitably retest the range lows at 17.5K.
3) Eventually BTC will most likely break the range lows followed by a massive sell off.
How to trade:
1) As long as BTC holds support, you could potentially enter long and sell at the trendline
2) You could enter short at the trendline and take profits at the range lows.
***These are just what I consider to be the most likely scenarios for BTC, before entering any trade make sure you plan it out properly and have good risk management.
Thanks everyone and best of luck trading!
Let me start off by saying, BTC has a massive barrier to overcome to turn bullish.
What is this barrier I speak of?
***The Descending Trendline that been plaquing BTC since the November 2021 high.
What does this mean for BTC?
- Basically, this trendline is MASSIVE MASSIVE Resistance for BTC and will require a valiant effort from the bulls to overcome.
Is it possible for the bulls to break through this trendline?
- Of course, but highly unlikely.
- Eventually this trendline will break, but under the right economic conditions.
What type of economic conditions?
- Right now the markets are panicking, especially after the economic data that came out yesterday. We are currently in what is considered a "Risk-off" environment where larger traders and smart money consider it too risky to trade asset classes like crypto or volatile stocks.
- BTC will need to be in an environment where the economy is showing signs of improvement for a stable period of time, bringing larger investors back into play in the riskier assets such as BTC and crypto.
- Keep an eye on the stock market, BTC is highly correlated with stocks such as the Nasdaq, SPY and right now even copper. Once The broader stock market turns Bullish, look for BTC to turn Bullish.
Onto the actual analysis...
- Like I said, the descending trendline is going to act as major resistance, so from a trading perspective we know that...
1) The upside is limited (to that trendline)
2) The trendline could make for a good shorting opportunity
3) If price does end up breaking the trendline, thats extremely bullish for BTC and we can change our opinion form bearish to bullish.
What's likely to happen in the short term?
1) BTC will most likely retest the descending trendline
2) BTC will get rejected off that trendline and inevitably retest the range lows at 17.5K.
3) Eventually BTC will most likely break the range lows followed by a massive sell off.
How to trade:
1) As long as BTC holds support, you could potentially enter long and sell at the trendline
2) You could enter short at the trendline and take profits at the range lows.
***These are just what I consider to be the most likely scenarios for BTC, before entering any trade make sure you plan it out properly and have good risk management.
Thanks everyone and best of luck trading!
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