Bitcoin : 2 perspectives to draw trend line
Just like what we have said earlier, the way we draw a trend line can be very subjective especially when it comes to a very choppy market condition.
It also happens on the bitcoin when we see 2 scenarios to draw support trend line. The white parallel channel is based on the wick to wick connecting method and the yellow parallel channel is based on the wick to body connecting method. There is no correct or wrong way to do this, it's just based on personal preference and based on every trader's trading logic.
Because there are 2 ways to draw the trend line and both of them are valid, the gap occurs here. With the structure based on the white support trend line, we haven't seen any break out structure yet because it meets the strong zone of alignment which is the area around $20750 and the white support trend line.
Based on the common sense, it's more logical if we look at the white parallel channel as a guidance because this level is having alignment with the horizontal support on previous price action. And based on the historical performance, the price has respected this zone every time it tested.
Our perspective right now is to expect bounce from current zone to at least the area of $23500 region as the golden pocket zone. But if it goes either way and break below the $20750, we can expect further downside movement to the area of $19000 as the next confluence zone of support.
It also happens on the bitcoin when we see 2 scenarios to draw support trend line. The white parallel channel is based on the wick to wick connecting method and the yellow parallel channel is based on the wick to body connecting method. There is no correct or wrong way to do this, it's just based on personal preference and based on every trader's trading logic.
Because there are 2 ways to draw the trend line and both of them are valid, the gap occurs here. With the structure based on the white support trend line, we haven't seen any break out structure yet because it meets the strong zone of alignment which is the area around $20750 and the white support trend line.
Based on the common sense, it's more logical if we look at the white parallel channel as a guidance because this level is having alignment with the horizontal support on previous price action. And based on the historical performance, the price has respected this zone every time it tested.
Our perspective right now is to expect bounce from current zone to at least the area of $23500 region as the golden pocket zone. But if it goes either way and break below the $20750, we can expect further downside movement to the area of $19000 as the next confluence zone of support.
