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After Brief Recovery, Bitcoin's Price Action Suggests Further Downside

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

LTC/USD 1H Chart

Crypto Trade Board Review - 4/9/2018

Crypto Trade Board Review 4/8/2018