Bitcoin (BTC) Inverse H&S nearing confirmation
I was going to sketch up the inverse head and shoulders I've been seeing but upon opening TradingView I saw this post by MagicPoopCanon and decided to resteem his content. Although I couldn't find MagicPoopCannon on Steemit, so just be aware that I am not the original author of this content but I completely agree with the following.
Original Author: MagicPoopCannon
Welcome friends, foes, animals, aliens, my family of crypto lovers, to this update analysis on BITCOIN! Before we jump into the chart, I have to address the elephant in the room — the top trendline of the downtrend channel . There were a lot of people who were questioning that level, and many people were posting their own charts, showing that they had different trajectories for that trendline . It was pretty clear that many of you had log charts, and I do not. I have always relied on the linear scale, and it has never failed me. If you use the log scale, obviously your lines are going to be different than mine. The other discrepancy was that some of you appeared to be trying to catch the wrong highs. If you'll notice, from the left side of the chart, you can see that the all time high, and the second peak, are the primary tops that generate the top trendline of the channel. The test on 2/20, was a failed breakout, and it is not a primary peak in the channel. Therefore, you should not use it to draw the top trendline of your channel. I have connected the highs of 2/20 and 2/28, to show you the extension of support and resistance , in both directions. You can see that the extension to the left, does not come in contact with any prior peaks, so the notion that these two peaks are a reactionary part of the top of the channel, in terms of the linear scale, is incorrect. From my perspective, I'm in awe of how many ungrateful people there are, who so valiantly chastised my trendline , but were practically silent about the incredible call that I gave on the green trendline support. I gave you the EXACT low for the right shoulder. Where was all the buzz about that? Anyway, let's get to the chart.
Looking at the four hour BTC 4.56% chart, you can see that the current price action is back-testing the top of the downtrend channel (in pink.) This is actually extremely bullish price action, should BTC 4.56% hold support here and rally higher. As traders who are looking for a technical buy signal, we want to see BTC 4.56% hold the support here, and continue to rally higher. That's called "confirmation." BTC 4.56% has rallied above the top of the downtrend channel , and now it's trying to confirm that level as support. You can see that the 200 EMA (in purple) and the 50 EMA (in orange) are moving into the picture as well. They should add support to the top of the channel, as they converge with the pink trendline , thus increasing the likelihood of support being found.
Looking at the broad picture, you can see that the inverse head and shoulders pattern is still moving a long as planned, as BTC 4.56% continues to construct the right shoulder PERFECTLY, inside of the boundaries that I have specified. If you'll notice, we could be building a small inverse head and shoulders pattern inside of the right shoulder here, with the potential right shoulder being formed into the top of the channel. This small formation is in line with the assumed continuation higher that would complete the right shoulder. For now, we need to watch to see if BTC 4.56% can hold here, and continue to complete the pattern. On the MACD , you can see that it is rolling over, like it wants to form a bearish crossover. However, that hasn't happened yet. A break back into the channel would be a negative sign, but BTC 4.56% continues to violate the top trendline with increasing frequency, thus reducing it as a level of resistance. Currently, we need to see if BTC 4.56% defines it as support. From there, we will continue to assess the primary focus of my analyses, which is the inverse head and shoulders pattern, in anticipation of a break to the upside. A confirmed break above the neckline would be a very bullish signal for BTC 4.56% , and a confirmed break above the heavy resistance level (at about 12,7500 would be enormously bullish . I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic. Au revoir.
Here is the chart where I gave you the inverse head and shoulders pattern. I showed you with flawless accuracy, unlike anyone else. It has consistently been the primary focus of my recent BTC analyses.