Updated: Jun 23, 2019
Hope you are doing good in your trading journey.
Today’s major headline read – “ BITCOIN crossed $11,000 mark after 15 months”. This news has created havoc in the BITCOIN Community.
Currently market sentiments are super bullish and most of the traders are giving target of ATH ( All Time High Levels ) which were near to $20,000. Similar targets were made in 2017 euphoric rally too.
As of now, BITCOIN is up by 350% from its lows made in December 2018 which was 3215.2 ( BITFINEX Price). Sentiments have become super bullish suddenly after BITCOIN crossed psychology level of $10,000.
As you know, I am Price Action Trader, I believe only in Price. For me, Price is the KING.
So, let’s analyse the chart of BITCOIN for better understanding of this situation.
As you can see from the chart, BITCOIN after making high of 9109 on 30th May, it fell nearly 18% to levels of 7455. This was a good drop.
After making low of 7455 on 6th June, it is going up again after news of Facebook launching own crypto currency Libra came out. It has created a fresh breakout on BITCOIN with target being 11423. This resulted in trading prices to be around $11000 as of now.
Now, let us have a look at this chart. This chart shows that there is good supply zone at 11450-11750 levels (with multiple previous swing highs and lows)
I strongly believe that this ongoing rally in BITCOIN will face a big resistance around the 11450 - 11800 zone. Only If BITCOIN closes above this zone, this rally could extend to the 13400 - 13750 zone where it will face extreme resistance.
Also, if you look closely, you will observe an interesting Fibonacci combination around these levels.
Let me show you....
As you can see the Fibonacci Retracement level on BITCOIN from High of 19891in Dec 2017 to low of 3215.2 in 2018.
A 50% Fibonacci retracement level comes around 11553 levels which is also in confluence with supply zone and 61.8% Golden Ratio coming around 13520 levels.
I believe, if you buy at current level, you will be a victim of FOMO trading ( Fear of missing out ) resulting in loss in the near future.
I strongly believe that around these 2 levels, this ongoing rally in BITCOIN will halt and we will see a good fall in BITCOIN prices going forward.
So my final suggestion is “Don’t get carried away by current prices after seeing this rally in BITCOIN”
Thank for taking out time to read my blog. I hope – it was helpful.
I wish you a great and profitable journey ahead.