The BTC trading week, which began on 8 April, was a controversial one. At the beginning of the week, buyers continued their lazy attack on small volumes, but the replies of sellers were even weaker. Since this situation lasted from the beginning of the month, the probability of growth was gradually increasing. However, the main signal that we wrote about in the previous analysis was the breakthrough and fixing above the USD 5300 price. By 10 April, buyers were trying to finally break the situation on the market and grab this critical point. The true chance for buyers appeared on 10 April, but because of the small volumes sellers were able to protect this price:
We see that the main attack of buyers took place in the small volumes, and after that, the sellers were able to lower the price below the red trend line without problems and special volumes. Now the price is traded under this line and for us it is a repeated signal of buyers’ weakness.
If we analyze the situation on a daily timeframe, then we see that in the price zone of USD 5200-5300 for 4 days was a fight in which buyers lost. Now, buyers are trying to create another attempt, but we see that it is more like a correction before continuation of the fall:
Globally, starting from December 2018, the price is moving in the blue channel and is currently at the top of the trend line of this channel. Compare the volumes of the previous local high in the blue channel with the current local high:
In our opinion, these volumes are not enough to accelerate growth, so at best, we expect the continuation of the fall within the blue channel with the first stop of USD 4600-4700 (the middle channel line):
The critical price zone is USD 4200-4300. We think that from this price zone depending on whether buyers will continue their global growth or vice versa, the down trend will continue.
It is interesting to observe the mood in the market. Analyzing the chart of marginal buyers’ positions, we did not see confidence in their actions:
Also, we did not see confidence in the chart of marginal positions of sellers, which for the last few days was practically in place, forming pins:
If you analyze the index of fear and greed, then the mood of market participants is changing radically day by day. Yesterday, the value of the index was 42, today is 62.
According to the wave analysis, buyers corrected the fall from October 2018 by 50% and now the last wave of correction is over:
If you compare the waves correlation, then the wave Y = W * 1.618. Buyers could not pass this level of Fibonacci:
Therefore, we continue to adhere to the main scenario – the continuation of the fall, for the beginning to USD 4200-4300. An alternative scenario will be possible after breakthrough and fixing at USD 5,300.
Generally, the week is closed within the blue channel and under the global trend line, which was conducted from February 2018. Now the initiative belongs to the sellers. How it will be used by sellers next week, we can analyze already on Tuesday. We wish profitable trades!
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About the Author: Peter Oleshchuk is a trader and technical analyst. He has spent two years studying and analyzing the crypto market.
Charts Courtesy: TradingView