Invalidation of $20000 support, Direct drop?
Looking at the weekly time frame, we think that it's necessary for us to provide an update which because of the significant downside movement occurred recently.
With the latest break down below the $20000 support zone which is also the previous ATH on 2017, it delays our previous bias to expect movement to the area of $21000 range to be tested. We consider this as the delay movement and not an invalidation because the structure of defending this type of support hasn't ben confirmed yet and just like what you see, the price is now trending at a very oversold region which we can see sudden jump from current low anytime.
Looking at the weekly time frame, it's clear that the price is now trending slightly below the $19761 as the solidified structure of support which the price has been trending around this area for some times. However, the downside break down doesn't backed with the strong volume and there is still domination of long position on the market which reaches 95% as of now.
The domination of the long position in the market means that people are expecting upside bounce after they see recent drop in the market. However, The proportion of current short and long position makes us concern as when we see movement like this, there is likely we will see major liquidation of the long position first before the price continues to climb higher.
Looking at the confluence factors on the market right now, we see possibility drive lower to the area of $17600 as the interim low which will forms a double bottom and the action to close the gap here before it climbs higher. For additional perspective, the area of $16200 can be a great area of support for the extension of possible downside movement before spikes any higher. This area of $16200 region has the alignment with the unclosed wick occurred on November 2020.
At last, we only see this kind of drop as the action to liquidate early buyers which the price must wipe out the majority of long position before it continue to surge higher to the area of $38000 or even $46000 in the swing cycle. However, this is still a long journey to the upside. We must first focus on the shorter period of cycle which it's very important to averaging buy while the price is dropping even more.
With the latest break down below the $20000 support zone which is also the previous ATH on 2017, it delays our previous bias to expect movement to the area of $21000 range to be tested. We consider this as the delay movement and not an invalidation because the structure of defending this type of support hasn't ben confirmed yet and just like what you see, the price is now trending at a very oversold region which we can see sudden jump from current low anytime.
Looking at the weekly time frame, it's clear that the price is now trending slightly below the $19761 as the solidified structure of support which the price has been trending around this area for some times. However, the downside break down doesn't backed with the strong volume and there is still domination of long position on the market which reaches 95% as of now.
The domination of the long position in the market means that people are expecting upside bounce after they see recent drop in the market. However, The proportion of current short and long position makes us concern as when we see movement like this, there is likely we will see major liquidation of the long position first before the price continues to climb higher.
Looking at the confluence factors on the market right now, we see possibility drive lower to the area of $17600 as the interim low which will forms a double bottom and the action to close the gap here before it climbs higher. For additional perspective, the area of $16200 can be a great area of support for the extension of possible downside movement before spikes any higher. This area of $16200 region has the alignment with the unclosed wick occurred on November 2020.
At last, we only see this kind of drop as the action to liquidate early buyers which the price must wipe out the majority of long position before it continue to surge higher to the area of $38000 or even $46000 in the swing cycle. However, this is still a long journey to the upside. We must first focus on the shorter period of cycle which it's very important to averaging buy while the price is dropping even more.
