No surprises in the bitcoin markets over the past 24 hours given price has been consolidating in rather bullish fashion above the psychologically significant 4000 $ level but below short-term resistance in the 4400 $ area which appears to be confirming our outlook from yesterday that price is likely to [members-only content]. What this tells us is that the market is back to responding well to the technicals following a few weeks of downside volatility regardless of what the charts looked like, which should present us with some more opportunities to try to play the market while things remain highly uncertain overall.
We'll begin with one more look at the 6-hour chart this November where we can see that the relatively small Adam & Eve double bottom in the 3500 - 3600 $ area was confirmed on the move above 4120 $ which came on [members-only content] signals and predominantly [members-only content] candle formations following the [members-only content] which kicked this rally off a few days ago. Also note that near-term market structure has improved substantially, the EMA's have reversed to the upside, new dynamic support is now building around the [members-only content] $ level, and so far the lower supply area and historical dynamic resistance dots have not done all that much to deter the bulls. On the other hand, all of the longer-term moving averages continue to move steadily lower, very strong dynamic resistance continues to build further overhead, and the Ichimoku Cloud is beginning to re-expand to the downside out in front of the market, so we still think that this entire rally is countertrend in nature even if it does end in a spike above [members-only content] $ at some point.
Moving on to momentum and volume, notice that the Stochastic is already in officially overbought territory, MACD is stalling out, and PPO just started flashing weak sell signals, none of which are great signs for the bulls over the near-term, although Willy and RSI still have some room to run higher which could easily support the last leg of this move up to the previously discussed [members-only content] $ region. This is being confirmed by the exchange volumes which have turned more bullish recently and the volume profile setup which is thinner above the market than below (at least up to the [members-only content] $ area), although the still lackluster A/D tells us that this bullishness will likely be short-lived which is why the bulls need to act soon.
Next up is the 3-day chart before we zoom out even more to the weekly chart tomorrow, and we can see that SCMR continues to print [members-only content] signals while market structure remains broken and heavy and strong dynamic resistance continues to actively build overhead, none of which bodes well for the bulls, although the upper demand areas appear to be doing a fairly good job of attracting buyers for now which is why ultimately still have hope that the [members-only content] $ region can hold on the next wave to the downside. Also note that the EMA's are stacking lower once again, the 50 and 100 SMA's continue to fall as well, and the Ichimoku Cloud is growing more bearish out in front of the market, however the 200 SMA continues to rise despite being well above price which should give the bulls a bit of hope moving forward. Overall we see nothing that indicates that a sustainable reversal is yet in the offing, but we do see potential if we can get a bullish candle coming off of the [members-only content] $ region on the next leg of the bear market.
As far as momentum and volume are concerned, Willy is starting to reverse off of the top of oversold territory, RSI has already started moving higher, the Stochastic remains pinned in oversold territory, and PPO is still flashing weak buy signals, all of which are fairly encouraging for the bulls moving forward, although MACD still looks anemic so there nothing to get too excited about just yet. Having said that, exchange volumes are getting back to normal for now and the A/D line is starting to recover, all while the volume profile notch around [members-only content] $ that we have been talking about for months could still use more attention, so perhaps this level acts as a magnet if another leg higher indeed materializes. That said, we have yet to see the capitulatory volume washout that needs to happen to truly end the bear market from a longer-term perspective so we continue to expect [members-only content] before all is said and done.
The way the technicals look over the near-term it could be another day or two before a move away from the ~4000 - 4400 $ area materializes due to the overbought nature of the VST momentum indications, although if there is a resolution from this range we think its likely to be [members-only content]. While this is not the best news ever given the assumption is [members-only content] after the end of this rally, it at least gives us some time to better gameplan what we think will be the best course of action once the market does reach the selling climax we are looking for which we will discuss in further detail when we look at the weekly chart.