The bitcoin markets continue to move slowly and steadily to the upside as expected as we head towards the end of the week, and for now the technicals are still supportive of another leg higher up to the [members-only content] $ resistance zone so we don't think this rally is over just yet. That said, there continues to be a significant amount of resistance around that [members-only content] $ level and above it as far as the eye can see, so we fully expect the bears to return to the marketplace once those levels are reached over the coming days. Granted, there remain some very encouraging patterns that continue to take shape on the longer-term charts that are increasing the chances of [members-only content], which we'll discuss below, however nothing has been confirmed at this time and the bears still have a lot to work with so we'll stay cautious despite our bullish near-term outlook.
We want to take one more look at the 6-hour chart today as it remains best view of the short-term setup where we can see that price is still consolidating in the lower supply area within what appears to be a bullish flag formation or messy ascending triangle on [members-only content] signals while market structure continues to slowly improve, all quite encouraging signs for the bulls moving forward. So is the fact that price is finding support at the still slightly bearish 50 SMA while all of the other moving averages continue to rise, dynamic support continues to build, and the Ichimoku Cloud is still bullish out in front of the market, so it certainly looks like another leg up is likely in the not too distant future. That said, resistance gets quite heavy around and above [members-only content] $ due to the intermediate supply area, the OTE short zone, and the old trendline so we think a more substantial retracement materializes after a test of that resistance patch.
Moving on to momentum and volume, notice that Willy is about to join the Stochastic in officially overbought territory and PPO has started to flash sell signals, which confirm that this rally is nearing its end, although RSI still has some room to run higher and MACD remains above its zeroline which leaves the door open to one final move up before weakness returns to the marketplace. The still very porous volume profile setup below the market confirms that a selloff back into the [members-only content] $ is likely once [members-only content] $ is tested, although exchange volumes and the A/D line show the bulls taking over the market for the time being which is a very good sign in terms of a longer-term accumulation.
We'll also take one more look at the 3-day chart given the daily chart is not very helpful right now, and we can see that there not much happening here either given SCMR is printing another [members-only content] signal on a bullish candle formation while market structure remains uncertain and the EMA's continue to flatline, all suggesting [members-only content] over the short to medium-term. Also note that the Adam & Eve bottom and the Cup and Handle continuation both remain intact while price stays close to the upper demand areas, both good signs for the bulls overall, however the 50 and 100 SMA's remain in steady downtrends and the Ichimoku Cloud is still firmly bearish so we'll stay cautious until more confirmation of a bottom emerges.
As far as momentum and volume are concerned, notice that Willy and RSI have both found support around their midlines and are now starting to perk back up and MACD has held above its zeroline recently which is good news for the bulls, although the Stochastic is still heading lower with room left to recharge and PPO is very close to flashing sell signals so [members-only content]. The dwindling exchange volumes and the still lackluster A/D line confirm this outlook, however the volume profile setup continues to support a [members-only content] at some point over the coming months so we'll continue to try to get long at favorable r/r levels below the market.
As we said earlier this week, the longer the bulls wait to push price above [members-only content] $ the greater the odds of failure are on a retest of that level due to the increasingly overbought nature of the short-term technicals, so we think they need to act by the end of the weekend else they risk the bears returning to retest [members-only content] $ (at the very least). Even if the move up to [members-only content] $ that we are expecting does indeed materialize over the coming days we still think the bears are lying in wait in that region to put the heat back on the bulls, so regardless of what happens this weekend we still think we get a shot at the VST ProTrade before any sustainable move above [members-only content] $ occurs.