'Finally back from the States and feeling a little jaded but it was a super valuable experience with some exciting partnerships established - all of which will help evolve the BitScan product.
In the meantime, the bitcoin market has continued to consolidate over the weekend, forming the ever tightening wedge formation that we have seen before.
This is what it looks like on a chart:
On the one hand, having already made a lower low ($585) and a lower high ($1065), this is an ominous pattern; while support at $835 has held up to 2 tests, every rejection is weaker than the last, with bears taking charge of the order flow at lower and lower prices. If $835 gives on momentum, $750 is a racing certainty.
However, if you look closely you will note that the market has been pressing against the top of this wedge for the last 3 bars so it isn't inconceivable that we will see an upside breakout, which would likely trigger a 'short covering' rally back up to $965 and possibly $1065.
As we noted in our last post, this market has moved from a trending to ranging condition in the short term. On balance of probabilities this period of consolidation will lead to a resumption of the up-trend, but topping markets look a lot like this one before they make their mind up, with a deeper correction always a possibility. For this reason, it makes most sense to enter any trades you are considering from the extremes of the range.
So, if you following this logic and you remain bullish, placing your limit buy orders at around $750 remains a rational strategy.
Trade safe,
Rob @ BitScan
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