Bitcoin is currently enjoying bullish momentum and has broken through a number of key areas. However, I see the volume declining and a confluence of strong resistance ahead which makes me bearish. My findings are as follows:
- A bearish trendline (orange line) which marks a downtrend since February
- A strong historical support and resistance area around 7450 (red line)
- 50 Day SMA which is also around 7450 (Blue line)
- Declining volume
It is possible that Bitcoin can extend its rally right through to the 8k - 8.4k region before turning. However, I see a return to the 200 Week MA (5500 - 6000 region) in the next few weeks. Perhaps even lower and retesting lows of 3800.
My current strategy: I am building a short position from 7400 - 8200 with a stop loss at 8600.
- A bearish trendline (orange line) which marks a downtrend since February
- A strong historical support and resistance area around 7450 (red line)
- 50 Day SMA which is also around 7450 (Blue line)
- Declining volume
It is possible that Bitcoin can extend its rally right through to the 8k - 8.4k region before turning. However, I see a return to the 200 Week MA (5500 - 6000 region) in the next few weeks. Perhaps even lower and retesting lows of 3800.
My current strategy: I am building a short position from 7400 - 8200 with a stop loss at 8600.