We thought bitcoin was going to have a stronger fight then that even though we anticipated downside to $6000 eventually. BTC/USD rallied above $7000 over the weekend, but failed to tag $7200, and subsequently fell sharply below $6800 to start the 4/9 US session.
BTC/USD 1H Chart
Head and Shoulders
- After the failure to push above $7200, BTC/USD price action effectively built the second shoulder in a head and shoulders pattern.
- I know we are used to seeing these at "tops", but more often, we actually see these as consolidation within a downtrend.
- My experience with crypto suggests we have more of these in crypto so far than other markets.
- In other words, I am even more convinced by the Head and Shoulder that there will be further downside because of the prevalence of this signal.
- As BTC/USD slides, the $6900-$7000 area will become key resistance to confirm the downside to $6450.
- A break below $6450 would strengthen the prospect for $6000.
- Also note that LTC/USD has already been developing this head and shoulders bearish continuation pattern, and is also slated to slide lower, to $100.