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Bitcoin Weekly Market Update 07-07-2019: Market Cycles

Updated: Nov 23, 2019

Bitcoin continues to chop and leaves investors and traders alike wondering whether the top is in or whether new highs are in sight. In my mind, there's signs beginning to form indicating where in the market cycle Bitcoin might be and clear levels of invalidation, so let's take a look.

Bitcoin Weekly

Bitcoin Weekly July 9

The only significant change on the weekly chart is that with the weekly close the ugly shooting star of the prior week has been invalidated. Does that make me more bullish? Not particularly, but maybe less bearish. Bitcoin is still ranging between the two weekly supports and until one of those gives way there's no sense making major moves. I'm still betting on down before new highs but a close above $12,000 with volume would change that.

Support: $9,500-10,500

Resistance: $11,500-12,000

Bitcoin Daily - Market Cycles

Zoom out on the daily Bitcoin chart and take a minute to evaluate it. Look at 2017, where do you think we currently are in this cycle? Have you seen this before?

Psychology of a market cycle

Now compare this to the above and think about where Bitcoin is in this cycle. My thoughts?

Bitcoin market cycle

In my opinion Bitcoin is right at the second last peak before Optimism kicks in but the question is whether the dip where the Hope peak gets tested already happened on the break of $10,000 or whether there's a deeper retrace still to come. What do you think? As you can see from the above and from what I previously mentioned, I'm betting on more downside. For the reasons why, let's jump over to the 4-hour time frame.

Recently, Bitcoin has printed three consecutive lower high's after a long series of higher high's and higher low's. Additionally, it posted a lower low which in addition to these lower high's suggests that another lower low could be on the horizon. If Bitcoin posted a higher high of $12,000 or more, the bearish scenario is likely invalidated.

In summary, I believe Bitcoin is consolidating in the phase right before Optimism which is likely the point BTC starts to gain mainstream coverage again. The question is whether the low of this point is in, or whether it's yet to come and the 4-hour chart suggests it's not.

That's it for this week - if you want more regular content, be sure to follow me on Twitter. Decide to trade Bitcoin based on my charts above? Do me a favor and register at Bitmex, Binance (margin trading coming soon!) or Bybit which is currently offering up to $60 bonus for new sign-ups.

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