As I do every week, I review the previous week’s analysis and then explain my vision for the week ahead. Here we go!
Disclaimer: This article does not constitute investment advice or an invitation to invest. It is strictly for informational purposes only. You are solely responsible for the trading and investment decisions you make.
Debrief of the past week
We are coming off an epic week. As predicted last week, a rise was in order. If you hadn’t read my article and want to see what I said, please do!
We did some seller liquidations, which allowed us to see green to the target which was the top of the range resistance. It has already been touched twice!
This bodes well, especially closing above $20,439, as it validates a weekly W-shaped pattern on the Binance BTC/USDT chart.
Cautionary signals for this week
However, even if this very strong bullish signal is there. We can be wary, especially when we see what is happening on some altcoins like Chiliz $CHZ or $DOGE. A bullish sentiment seems to be taking hold on these, which could lead to a retracement this week.
Zoom in on altcoin sentiment and Bitcoin price action!
A feeling of FOMO on altcoins
Indeed, I don’t go easy on this stock, but the orderflow never lies. And here, what I see is a strong increase in position thanks to the increase of the Open Interest (+13% on the rise). While having a funding that pushes in the positive meaning that the buying positions become the majority on the altcoins.
This means that a feeling of Fomo (=Fear Of Missing Out) sets in. Often this kind of signal is accompanied by a (short-term) bearish return of Bitcoin.
Michel NaAb? Quite simply, because we need to punish the last entrants, those who want to win like the others, and who will certainly lose.
Towards a Bitcoin Pull-Back?
If I continue with my logic, then Bitcoin would have to retrace, punishing the FOMOers (yeah, I’m making up words) and allowing to create a higher low than the previous one which could notably lead to a new bullish trend!
A healthy move would be to go back and test the wicks or candle bodies that made this beautiful start possible. The two white lines mark this area. It lies between the $19950s and the $19550s.
If we get into these areas with a Fomo feeling that stops on the altcoins then it should be fine (yes it should!).
And to support this, the short term price action (in 1hr!) also seems to indicate a return to the downside. Why? Quite simply, because we are liquidating sellers slightly and attacking downwards, meaning we want to go down taking as few people as possible!
You’ll have understood, a nice week just ended, and probably a more bearish one should start. A return to the downside to remove the FOMO on altcoins would be healthy and would allow for a quality rise! And we like quality! See you next week for the analysis, we’ll see if Bitcoin has decided to prove me right! Last parenthesis: we will have to pay attention to the FED meeting on Wednesday at 7pm. In the meantime, don’t hesitate to read our other guides. Have a good week.
Entrepreneur & Dad, passionate about cryptocurrencies, I describe for you the technical analysis.
My job: look at charts and interpret them for you.
Beware I do not know all the truths.