BITCOIN: CRITICAL LEVELS!! BOUNCE OR DROP?!

X FORCE CRYPTO ANALYSIS:

We are currently trading sideways within strong support and resistance zones, with half of the market long, and the other market short. Let's take a look at both the bullish and bearish arguments.

Bullish Scenario

- We are seeing a reverse head and shoulders pattern play out on the hourly, currently looking to potentially complete the right shoulder
- We have seen a double bottom formation at 7.7k levels, demonstrating the strength of the support
- There is potential for a bull flag breakout to 8.7k levels, which is realistic considering the fact that we have seen a quick pump to 8.6k recently
- We are seeing a bullish divergence, with lower lows on the price, and higher lows on the Relative Strength Index (RSI)

Bearish Scenario

- We have been trading sideways for a while. This could potentially be a bear flag on the longer time frames
- We are still trading below the 200 Standard Moving Average (SMA) on the daily
- The volume is extremely dry, so currently there is no volume to fuel a bullish breakout

Market Sentiment:

Currently there are more long positions open than there are shorts.

What We Believe

Although the support and resistance zones are both extremely hard to break, we need to break over 8.4k to confirm a bullish trend up to 8.9k levels. On the other hand, for a bearish scenario to play out, we need to test 7.7k support, and then 7.2k, and at that point, re-evaluate the situation to determine whether the bottom is in or not. Although we believe the bullish probability is higher, should we break down from here, 7.2k should act as very strong support as it's where the 1.618 Fibonacci support lies on the weekly.

Trade Safe.

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