The bitcoin markets did very little during the day on Wednesday, as we continue to struggle in general. The market looks likely to continue to see a lot of choppy and short-term trading, but quite frankly there is one line that comes to mind when I look at bitcoin: “it’s the place money came to die.” This is a market that has significant support below at the $6000 level that extends down to the $5800 level, but I think it’s difficult to break down below there. If we were to do that, that would be a very negative sign indeed, and quite frankly there’s nothing on this chart that doesn’t suggest we will eventually try to do that, but so far it’s obvious that there is a lot of support. Overall, if we do rally from here we have to deal with the trend line as well, which is the top of the descending triangle. This is an area that has a lot of interest paid to it, and therefore I think it makes sense that a short-term rally from here could be a selling opportunity.
However, if we do break above the top of the downtrend line on a daily close, then I would be willing to flip my analysis around and start looking for targets to the upside. The problem is that every time we get good news coming out of the crypto markets, it’s short-lived at best or doesn’t move the market at all. If we do break down, I think the target is $5000, and then eventually lower than there. The descending triangle measures for a move towards the zero, which I don’t necessarily believe will happen, but quite frankly there is nothing bullish about this chart at all.
