Building on last weeks article that Bitcoin had the potential to move lower, this weeks article will be an extension of that topic.
Before I begin, it is worth noting that their is over $10
billion of short liquidity sitting between $70,000 and $72,000.
Based on previous behavior and patterns it is therefore highly likely BTC goes back to this area, no matter if we see a further extended price drop next week.
Source: Hyblockcapital.com
Getting technical and about as basic as it gets, Bitcoin broke under its 50-day moving average and its 111-day moving average recently, which is midly concerning.
More worrisome is the fact that 111-day moving average, which has been used a buy spot during most of this year, and has been breached for a few days on a row.
Source: Tradingview.com
Notably, the 200-day moving average has risen considerably since the May correction from $51,500 to $56,500.
Short-term moving average analysis (on the four-hour time frame) shows that any sustained move above $68,650 should end this damp period for Bitcoin.
Source: Tradingview.com
Encouragingly, DeMark analysis provides a much clearer picture of what to expect and indeed the likely targets.
Very simplistically, the DeMark system is calling for one more minor low next week under this weeks current low. The caveat being the recovery target.
Source: Symbolik.com
According to Tom DeMarks system a new low followed by quick recovery would be the signal for gains towards $70,100.
Very logically, the recovery must be fast in order to have any chance of Bitcoin hitting a new ATH by the end of the quarter.
On the bear side, if we no new low and quick recovery happens then Bitcoin has a bearish target of $61,000.
Source: Symbolik.com
I'm assuming a heap of buy orders will be found in this area, but really and truly I hope we don't see an early week wipeout.
DeMark analysis shows that ETH needs to clear the $3770 level to perfect its ongoing buy signals. If this happens then a new ATH is highly likely.
Source: Symbolik.com
If not, and ETH fails to get past $3770, the worrying downside target and probable mass liquidation trade shows $3,000 upcoming.
Overall, keep a close watch on the $65,000 to $66,400 range, as a confirmed break from this range should determine the next $5,000 price move in Bitcoin.
