Bitcoin is finally moving up. Price chopped around the pitchfork median and 0.31 for a while instead of tagging them cleanly, but it finally bounced well. Last night there was a fast long flush to around 75.8K: the market needed to take the liquidity below, and it’s been rising since. Five red weeks in a row, and this week is green so far, with the weekly 0.31 holding, just as expected. The algorithms bought at both 0.31 and the median. Sure, I’d have liked more precision, but news and many other factors move the market. Fear & Greed is in fear: historically a decent place to look for longs, and when sentiment turns bearish while supports hold, that’s good for anyone looking to buy.
The liquidity below got taken quickly, and price went up. Above us there’s a big cluster from 78.9K to 79.9K and even more higher up, toward 82.1-82.7K, which could act as a magnet if the rally builds. But liquidity remains under the 74.9K lows, and on a reversal the market could go back for it. Open interest also ticked up on today’s rally, which I don’t like: we still haven’t had a real reset. If I see big green OI candles, I’ll quickly start opening shorts. No major warnings yet. On the 4H, the key resistance is a large supply zone from 79K to 81K, where price ranged before the dump. Bears should look for a rejection there. Bulls need a break and close above 81.8K: that ends the series of lower highs and starts an uptrend, with liquidity above 82K. Another resistance is 0.31 from high to low around 79K, which we’ve just hit. We don’t want a daily close below it.
A key difference: total market cap has already swept its lows, while Bitcoin hasn’t. So Bitcoin still carries short-term risk of going back for that liquidity, while total cap may have bottomed. Impulse, correction, and now we wait for the next impulse. On the Bitstamp daily the pitchfork target on linear is 94K, and I think Bitcoin gets roughly there in the coming months. On log it’s around 89K, and Bitcoin bounced nicely off that pitchfork line. USDT dominance rejected cleanly from 0.31 between the yearly highs and lows and is starting to break its uptrend. Bulls need it to keep falling, which I think is the most likely scenario.
ETH is breaking its downtrend line as I record, which could be the start of a rally. The head and shoulders we discussed has already played out. I never measure pattern targets by head height; 90% of the time they aren’t reached, that’s what gets sold to retail. The weekly is back above 0.31, but since the level broke before, I’m ignoring it. The shift pitchfork from recent highs, lows and highs that many of you sent me worked perfectly, though: the bottom landed right on the median. I don’t like those forks myself, but I respect those who use them. On the 4H there are impulsive candles, and ETH wants new highs. The key level is 0.31 from the recent high to the low on linear, around 2,400, with a demand zone below. Ideally it breaks, retests the demand zone and starts a higher-degree fifth wave, but that’s not a forecast and I don’t see a setup yet. ETH/BTC, on a shift pitchfork from last August’s high, June’s low and this August’s high, may still dip to the median, and that’s where I’d start rotating from Bitcoin into ETH. The weekly shows the same pattern: impulse, correction to the median, impulse. Long term I’m optimistic on ETH.
Trading cryptocurrency involves substantial risk. This analysis is for educational purposes only and is not financial advice. Past performance does not guarantee future results.
