One more week has passed, during which the price continued to move in the triangle. Looking at the daytime timeframe, you can see certain green candles that alternate with little red candles. Such a picture should mean that buyers have much stronger positions than sellers and that growth should continue. However, if you look at the volume of trades during the week, it becomes clear that we cannot rely on current prices and predict the continuation of growth:
Too small volumes of growth tell us about the high probability of continuation of the consolidation and the passive position of sellers in the market. Theoretically, buyers even managed to break through the trend line of the triangle and now the price is trading over it. However, with the breakdown of trend lines of triangles, in which the price was consolidated for 4 months, there should be a pronounced increase in volume and large aggressive bull candles. In our case, we see the ending of the buyer forces and the high probability of returning the price to consolidation.
As we wrote in previous analyses, an important price zone for the continuation of growth is $4,200-4,300. Looking at the dynamics of volumes, starting in March 2019, the probability that buyers are trying to overcome this price zone is now extremely low. There is a much larger probability of a sharp fall to $3,650-3,700. In this price zone, the lower trend line of the triangle passes. Also, in this price zone was the first stop of the fall in prices from 25-26 November:
Despite the rise in prices this week, marginal buyers positions are in consolidation. Buyers unanimously do not increase their positions.
Sellers are trying to increase their positions but they do it with uncertainty:
The fear/greed index is quite high. Approximately, at such rates sellers begin to take the initiative into their own hands:
If we analyze the waves inside the triangle, then we see that the wave “c” is finishing now, after which sellers must test the strength of the lower trend line and form a wave “d”:
Looking at the overall picture of the weekly timeframe, we notice only the weakness of the buyers inside the triangle and the probability of continuing consolidation until the end of April 2019:
So keep up patience and continue to monitor the weakness and deadness of the market. We hope that the next month will be much more active, but so far there are no prerequisites for this.
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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. Image Courtesy: Bitcoin News