A practicing trader and founder of the project Crypto Shaman Vadim Shovkun.
Finally, a breakout from the sideways monthly accumulation has occurred. We assess whether the market can be expected to move higher.
Technical Analysis
A breakout of the strong resistance level of $17,600 on a large candle with high volume has occurred. The upper wick, according to price action, signals buyer weakness and is, in this case, an advantage to the upside. On lower timeframes one can observe movement in a ‘climax’ pattern, which is much better than a ’rounded’ one.
On the four-hour timeframe, the volume of the last bar finally matched the figure from November 22. Comparing them, one can note that buyer aggression is growing.
The last bar is more impulsive. The spread (the difference between the high and low of the candle) is higher than that of the first bar. Accordingly, volume is also higher, but not two or three times as much as the first bar. This suggests that a large player did not take profits on this pump.
The price has held above the broken $17,600 level. This is also a strong argument in favour of upside.
Market Sentiment
Most trader-analysts are bearish on the market, talking of a new bottom and a slide to $12,000. VIP channels are shorting.
Sentiment on Twitter and Reddit is also short. A lot of FUD scares the crowd. The classic pattern is that a decline occurs first, then news comes out. If negative information is released, but there is no decline, and this happens several times, it means the market maker is accumulating long positions against the crowd. This was noticeable in recent months.
Giving in to FUD now would continue to allow the big player to accumulate positions at your expense.
What does it all amount to?
After breaking $17,600 there may be a brief pullback. Yet the market’s expectations remain the same — upside ahead.
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