First off, this is only one side of the coin here; there's some bearish signs medium term as well that I don't talk about (possible hidden bearish divergence.
Here I'd like to talk about reasons to be at the very least short term bullish. I've drawn two bull flags; the larger, purple, one has an uglier look but for a larger formation it's at least plausible. On the other hand, both it and the blue flag would break up on the same movement so maybe concentrate on that one first. The blue one still isn't perfect, but it's definitely more reliable looking compared to the purple one if smaller.
The more convenient thing about these flags is where their normal targets would lay. The band I've drawn is the 7800-8200 region, which has consistently acted as a barrier to price movement more or less ever since the 11.8k double top. The main takeaway from the circles is to show how the price tends to be reluctant to enter these zones, with their edges acting as a resistance/support. In two cases, most notably immediately before the current crash, the price has been stuck in the area between the flag targets (sometimes it has gone right through though). The confluence there though coupled with it being a psychological resistance makes me think the price should be somewhat magnetized there to test how strong those two resistances are, in particular the bottom 7.8k zone, to at least confirm it.
7.8k is also the area of the 38.2% retracement of the 9900 DCB and the 50% retracement of the 9000 bounce: imgur.com/a/Dmq8f and imgur.com/a/iK13w.
It seems like such a significant level that the market should magnetize towards to test before continuing downward.
Also pictured is the 4 hr RSI bullish failure swing that preceded this move.
Here I'd like to talk about reasons to be at the very least short term bullish. I've drawn two bull flags; the larger, purple, one has an uglier look but for a larger formation it's at least plausible. On the other hand, both it and the blue flag would break up on the same movement so maybe concentrate on that one first. The blue one still isn't perfect, but it's definitely more reliable looking compared to the purple one if smaller.
The more convenient thing about these flags is where their normal targets would lay. The band I've drawn is the 7800-8200 region, which has consistently acted as a barrier to price movement more or less ever since the 11.8k double top. The main takeaway from the circles is to show how the price tends to be reluctant to enter these zones, with their edges acting as a resistance/support. In two cases, most notably immediately before the current crash, the price has been stuck in the area between the flag targets (sometimes it has gone right through though). The confluence there though coupled with it being a psychological resistance makes me think the price should be somewhat magnetized there to test how strong those two resistances are, in particular the bottom 7.8k zone, to at least confirm it.
7.8k is also the area of the 38.2% retracement of the 9900 DCB and the 50% retracement of the 9000 bounce: imgur.com/a/Dmq8f and imgur.com/a/iK13w.
It seems like such a significant level that the market should magnetize towards to test before continuing downward.
Also pictured is the 4 hr RSI bullish failure swing that preceded this move.