- The bear flag formation on BTC/USD charts appears to be continuing, suggesting that the current BTCUSD uptrend may be nearing its end. The bears' outlook is more optimistic than the bulls'. Long-term buyers waiting for a daily candle to close above $26000 should enter or increase positions at that time.
- Some algorithms and traders might also draw an ascending channel on the daily timeframe, as presented withing the BTCUSD technical analysis video below. According to that ascending triangle, bitcoin price has already broken down.
- The $20000 level remains a significant round number that BTCUSD can easily test in order to flush out bulls who view it as a line in the sand and place stops around it. It's likely that the institutions that took the other side of the trade, would prefer to keep bulls from participating in a profitable rally.
- Crypto bears still have a favorable reward-to-risk ratio because a $12k price target is not completely unrealistic. In terms of a more modest and quite a realistic scenario, bitcoin price target of about $18800, is still relevant for short traders (see why in minute 3:14 below). On the other hand, the bear flag would be rendered ineffective if a daily candle closed above $26k.
Simply put, I still think the bitcoin bears have the upper hand over the bulls at this point.
Update: BTCUSD is now down apx 5%, within a few hours after this post has been published. Bitcoin reached the VWAP "magnet" from a pivot point (the low of 18 June, close to where the stock market also bottomed). At such points, professional short sellers tend to take partial profit. Bitcoin remains in a channel. that is also a potential bear flag. If it breaks, there's probably more down, and testing 20k would be bitcon's next station.
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