Welcome crypto enthusiasts! I wish I had some brilliant market insight to share with you but I'm afraid what I am sharing here is probably more likely obvious to many already. Having said that though, I will share my opinions anyway.
Looking at the chart I have published you can see that Bitcoin is once again approaching a very important medium-term trend line. It is this trend line that Bitcoin tested several times in November before finally failing and dropping about 50%.
In the last chart that I published on March 2nd, I shared that I was seeing continuation patterns forming on both the Bitfinex price chart and on the Coinbase chart. On the Bitfinex chart, what I saw (and still see) is a symmetrical triangle pattern in the process of being formed. On the Coinbase chart, what I see is an ascending triangle forming, both are bearish continuation patterns.
The big question I have now is how will Bitcoin react this time to the medium-term trend line? Will it once again prove to be too much resistance for Bitcoin to overcome causing another large decline? Or will Bitcoin finally be able to break through and start a meaningful recovery?
I would love to see Bitcoin smash right through it and start heading higher. I would even be happy to see Bitcoin break through it and just continue sideways for a while. Either way if Bitcoin can break through, I feel that it will be a substantial psychological event that may signify that Bitcoin has indeed bottomed. Having said all of that though I must be honest and say that I am leaning more towards Bitcoin failing once again.
If in fact Bitcoin does fail to push through, I can envision a couple of possible scenarios.
The first is the most extreme scenario in which Bitcoin fails once again and has another substantial drop and eventually retests the 2013 high at $1175.
The second scenario is that Bitcoin fails once again but only drops and retests the mid December lows around $3200 forming a double bottom which I believe would strengthen the case that the $3000 to $3200 level most likely is the bottom for Bitcoin.
I will say that even if the first scenario was to happen, I still am and would remain bullish on cryptocurrencies long term.
Until the next article, Take care!
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