– WhaleTrades 🐳 (@WhaleTrades) February 7, 2020
Bitcoin hit new high?
Minutes before the sell order, Bitcoin soared above $ 9,890, reaching a new high for the year. However, the rally failed within minutes of hitting $ 9,737, which reminded traders of pump and dump behavior.
Full-time trader Salsa Tekila has warned of a potential Bitcoin flash problem shortly after noticing the formation of long wicks on short-term charts. The analyst said he was leaving all of his Bitcoin positions because of the “flash dump risk”.
/ 7 New yearly highs got sold hard into, I was greedy and didn’t close where I should’ve ($ 9880).
– SalsaTekila (JUL) (@SalsaTekila) February 7, 2020
Bitcoin's collapse from $ 9,890 to $ 150 caused other traders to follow the same trend. For example, TraderMJ confirms that he is studying liquidity on the possibility of price volatility reversal. He added that he will not open any new short positions and believes that market prices are still on an upward trend.
“No short, I don't do it when prices tend to rise, but will seek to buy back at 9700 or 9500 (preferably 9500).”
Not liking this close. Took out liquidity, and a triple high pattern where we often reverse. Not shorting, because I don't do that in an uptrend, but tethering up and bit and looking to buy back at either 9700 or 9500 (preferrably 9500). pic.twitter.com/FuqaXjCZy2
– TraderMJ (@ Markules10) February 7, 2020
Large wicks form when prices tend to rise – especially those that set new highs – often act as reversal signals. Forex analyst William Adkins has write:
“A long wick shows the buyer bid. Usually, the seller will then take advantage of the high price. Selling pressure caused prices to fall back. A sober trader may use a long wick to predict a change in price movements. ”
A small bounce is underway
The BitMEX XBT / USD 15M chart shows the pair is trying to turn up. The price has pulled back from an intraday low of $ 9,737, but is still very weak, resulting in a prolonged bearish correction.
Bitcoin is trending in the Ascending Channel, currently testing the lower trendline. This recovery shows that traders are likely to continue the upward trend. On the other hand, a breakout may raise concerns about price collapse for the 200-period moving average (around $ 9,687).
On the other hand, the daily chart shows that Bitcoin's bullish spread is still maintained. The price has fallen but still sustains above the critical support of $ 9,608 – the Fibonacci 36.8% retracement is measured from a high of $ 20k to a low of $ 3.2k.
Falling Wedge adds that the Bitcoin price has made a breakthrough, targeting as high as $ 13,000.
Disclaimer: This is not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
Bitcoin Magazine | Newsbtc
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