BitcoinShort
Why the Biggest Crash Is Nearing (Beyond Fundamentals) - Part 1
Crypto investors confident that a new Bitcoin bull run is beginning, are likely to hold strong through any coming correction, while traders “buy the dip.” - this is imminent and cautious sideline technical investors are probably thinking otherwise. However, there is currently a bearish signal on the monthly timeframe that NO ONE IS WITNESSING at the moment. Bitcoin's current monthly RSI Bearish Divergence could suggest that a much bigger crash is in the timeline ahead of us.
As a personal fan of bearish divergences, this has almost always played out in the stock market. This has even happened with DEFI, in a much shorter time frame, leading to its 50%+ crash. Fundamental investors vs. technical traders were finding ground with each other with YFII, for example, only to lead to a big crash by the end.
Bearish divergences appear when an indicator sets a new high, but the price fails to do so in correlation. Simply put, the price prints a higher high, while the oscillator (RSI) creates a lower high. Extending that bearish divergence line even further, and switching to weekly timeframes, potentially reveals the dominant downtrend line that is still keeping Bitcoin at bay. Just like Bitcoin already broke free from a downtrend line before exploding toward $14,000, a new, dominant downtrend line was formed after the second peak. Adjusting trend lines is critical when re-analyzing the market.
Trend lines are considered valid when they have at least three touches or data points as always suggested from my previous analysis. Furthermore, the overall symmetry of Bitcoin's weekly structure is now resembling an ABCDE corrective pennant, which in return, may cause Bitcoin to return to lower levels. We aren't sure of how far this will go down, but with also a CME gap that has not been filled near 9K levels, this could be a big life changing opportunity trade for many.
Trade Safe.
X Force
As a personal fan of bearish divergences, this has almost always played out in the stock market. This has even happened with DEFI, in a much shorter time frame, leading to its 50%+ crash. Fundamental investors vs. technical traders were finding ground with each other with YFII, for example, only to lead to a big crash by the end.
Bearish divergences appear when an indicator sets a new high, but the price fails to do so in correlation. Simply put, the price prints a higher high, while the oscillator (RSI) creates a lower high. Extending that bearish divergence line even further, and switching to weekly timeframes, potentially reveals the dominant downtrend line that is still keeping Bitcoin at bay. Just like Bitcoin already broke free from a downtrend line before exploding toward $14,000, a new, dominant downtrend line was formed after the second peak. Adjusting trend lines is critical when re-analyzing the market.
Trend lines are considered valid when they have at least three touches or data points as always suggested from my previous analysis. Furthermore, the overall symmetry of Bitcoin's weekly structure is now resembling an ABCDE corrective pennant, which in return, may cause Bitcoin to return to lower levels. We aren't sure of how far this will go down, but with also a CME gap that has not been filled near 9K levels, this could be a big life changing opportunity trade for many.
Trade Safe.
X Force
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