MatTheCat
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November 10, 2015, 03:33:28 PM

1-day macd has turned red, do we expect a drop ?

Go draw a Fib retracement box from the $1160 high, right down to the $150 low.

You will see that the first resistance zone, is right at $390. Now of course, Bitcoin shot way beyond that, but much of that momentum was largely to do with shorters, who started opening short positions on the approach to the first Fib retracement zone, as TA 101 says that one should, suffering a brutal short squeeze. After that panic buying or forced buying was all burned out, Bitcoin has come right back down to, and consolidated just under the first long term Fib resistance point.

Over the past week, we have seen a thinning pennant forming. If we take the pole of this pennant, as being from $505 down to $350, then this is bearish as hell. If on the otherhand we assume the spike up to $505 being a bullshit spike, driven in the main by shorts being squeezed, and the usual FOMO brigade, and take the flag pole as being from the base of the previous significant correction, so $300, then the flag becomes a bull flag.

A sell signal for me at this point, would be a break below $360 (although I aint selling), and a buy signal would be a break out above $385.