Bitcoin Update: The Bulls Hit Back

Today the bulls hit back. We saw a spike in volume, followed by a rise in price from $7,060 to $7,520. While this is a welcome increase, it does not mean bitcoin hit bottom. We've had many quick surges in price these past few weeks, only to be followed by drops to lower lows. Does that mean that'll happen this time? No...but it's a possibility we need to be ready for.

The 2 scenarios I laid out in my last update are still very much in play. Let's quickly review them...

The bullish count has bitcoin having completed its ABC correction, and currently on wave 1 of 5 waves up. I've highlighted the sub-waves in yellow. If this count is accurate, here's how it may play out:

The bearish scenario has bitcoin in 5 waves down. If this count is accurate, it would currently be nearing the completion of wave 4. The fifth wave may get shortened as the support at $6,815 looks fairly strong. Zooming out to the 1 day chart, we can see it's penetrated this area these past few months, but only briefly. Buyers have been quick to catch bitcoin every-time it tries to decisively drop below $6,815.

With that in mind, if it does decisively break past this support, the target for wave 5 would be approximately $5,850. It may look like this:

Looking at the MACD and RSI, we can see bullish divergence on high (4 hour) and low (1 hour) time frames. This may foreshadow another rise in price.

Looking at EMA's on the 4 hour chart, it seems like the 8 day may cross above the 21 day EMA. This would be a sign of a strengthening market.
If you're unfamiliar with how to use EMA's, reference my post on the topic here: https://steemit.com/cryptocurrency/@workin2005/simple-effective-strategy-to-buying-and-selling-market-trends

As I've been pointing out for nearly 2 weeks, the 4 hour MACD continues to get compressed with lower highs and higher lows. It briefly droped below the wedge, but was quickly pushed back up. As it reaches the apex, a breakout up or down becomes more and more likely.

This week may be very telling for the overall direction of the market in June. We could see a decisive break in one direction or another. Personally, I'm not taking out any larger positions until there's more clarity. I'm making small scalp trades here and there, but nothing significant. If you choose to trade, I'd use a tight stop-loss.

BIAS:

Short Term: Neutral
Longterm: Very Bullish

I hope this has been helpful. I’d be happy to answer any questions in the comment section below. Thanks for stopping by.

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Disclaimer: I am NOT a financial advisor and this is NOT financial advice. Please always do your own research and invest responsibly. Technical analysis is simply a guide. It doesn’t predict the future. Anyone that claims they know exactly what’s going to happen is foolish, lying or both. Technical Analysis should only be used as a tool to help make better decisions. If you enter a trade, I recommend having a stop loss and sticking to it. You will loose at times. The key is to have more wins than losses. With that in mind, I wish you great success.

If you don’t have an account on Binance, I STRONGLY recommend getting one. They’re usually the first to get reputable coins, have excellent security and second to none customer service. You can sign up here free of charge: https://www.binance.com/?ref=16878853

FYI…I just started a twitter page where I’ll post analysis, along with other relevant crypto data from myself and others. If you’d like to be notified as soon as my updates reach Steemit, the twitter handle is @Workin2005