Bitcoin is going through one of its more stable time-periods, but that doesn’t mean we shouldn’t expect a significant move in the coming weeks or months. You can just never tell with Bitcoin.
There are however a few signs that indicate a possible incoming bearish move, and they’re on three different time frames.
The weekly chart gives us a nice view of the macro symmetrical triangle we’ve been talking about for quite some time. But with as hitting significant resistance on that top trend line and not breaking through, it is now quite possible we will bounce off that trend line and come back down into the middle of the symmetrical triangle.
A significant sign for me was where we closed on the monthly chart. We closed lower than we opened, and you know what that means? A red candle.
But it’s not just the fact that the candle is red that I’m bearish, it is the wick we saw in June that signifies a potential selloff. The small red candle and large upper wick creates for us what is known as a “spinning top” candle, and this is often bearish.
The daily chart further validates my bearish outlook, because we had an ascending triangle forming in the last few weeks. This triangle now seems to have been invalidated though. We broke out of it, moving sideways once we did, and the pattern no longer seems to be in play.
This means the bullish potential of that ascending triangle is absolved, and the bias flips from bullish to bearish.
Having said all of the above…
Despite the fact that all three charts indicate a bearish sentiment, I am still only 60/40 bearish, and because on the macro there is still so much room for a bullish leg up, it’s difficult to justify opening a short trade here.
So yes, I am pretty bearish (with a bias of 60/40), but not bearish enough to short the market right now.
We will reassess in the next week or two, and come back with an analysis.
Keep an eye on our Telegram group, and if I see any more interesting developments on Bitcoin or other crypto charts, I’ll be sure to share them.
For now, go through our Market Analysis video, where I give an overview of these three timeframes: