It also gives the RSI a nice reset and the fact that it bounced off of the 40 RSI is typically an indication that we may be starting an uptrend. This is known as a hidden bullish divergence for a continuation. 382 support.Įven though the RSI (relative strength index) has gone down, this can actually be viewed as a positive when the price goes up.
The diagonal downtrend that we’ve been watching on the daily was finally broken and retested, which is the point of entry for a good break out trade.Īs seen on the chart above, Bitcoin has also been finding support on each of the Fibonacci levels as it grinds it’s way upwards and currently sits on the. Trading Tip: Low Volume and low liquidity markets are much more prone to manipulation and large swings - technical analysis becomes slightly less reliable at this point. 382 Fibonacci level and the previous resistance turned support line was a great buying opportunity as buyers stepped in support the price. If you take a look at my chart below, you can really see how much Bitcoin respects the Fibonacci levels on the mid-term Fibonacci trend, just as well as it follows our short-term Fibonacci movements. We also waited for a retest of the previous resistance in hopes that it would turn into support, which it did as you can see below. If you have access to TradingView, you can also access the short term analysis here.Īfter Bitcoin broke out above the trendline, we waited for a long entry on the pullback. On a short-term analysis, Bitcoin finally found some movement last night as it retested the $6500 – $6550 trend line that had previously been a strong resistance dating back to late July.
Fibonacci Retracement and Fibonacci Extensions are very common tools for use in trading and Investopedia did a great write up that you can read more about here.
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