In the chart above you are looking at the 4 Hour chart of Bitcoin. After a meteoritical rise, our team expects to see a small retracement and then a continuation of the trend.
There are two possible scenarios that I can see at the moment:
The price continues to go down to the level of 7,000. That is where the first psychological barrier is located. That is also where the first minor support is at.
If we see a rejection pattern around this level and possibly a pinbar or bullish engulfing candlestick pattern, then this will give us green light for another long trade
Price does not stop at the 7,000 barrier. If it pierces through it, there is a chance that it will go down to the next support level, which is at 6,200.
Then, we will be looking for additional price action signs. If we don’t see any, we might see price dropping even further.
Price seems overextended, but BTCUSD is in a major uptrend. It would be foolish trying to go against the trend and short it, especially in the long-term.
If you are unsure about any of the terms or want to learn how to trade Bitcoin and other cryptocurrencies like us, REGISTER for our free newsletter and see how you can get our professional trading course for free.
Check out our beginner’s article on BITCOIN (includes everything you need to know about it)
or Check out how we build the first of its kind Platform for Broker Comparison and Trading Education