Bitcoin Rise and Fall CyclesJanuary 23, 2019
It is worth paying attention to the formation of past cycles of growth and decline: having reached its maximum, the price consolidates (green area) and then returns to the area where growth started (red area). This pattern can be found on different timeframes and various assets. Now, on the scale of 3-days, one can see that the movement is too long and the price remains in the consolidation area, this indicates that the cycle is not yet complete and the market should move closer to the area where the fall has started (mirroring the growth and fall cycles). Such a scenario takes place and is very likely in our situation, moreover, the market can update the bottoms before making a rebound, and the prolonged nature of the current movement once again confirms this (otherwise we would have moved up). It seems that the end of January and the beginning of February will not be “green”, but may give the possibility of a good drawdown for the purchase and further trade in long. Large scale indicators also confirm the likelihood of a decline before forming a rebound.
If we compare the fractal movement and a similar pattern of 2014, we see that after the bear market period, a flat has come, but with a subsequent bullran on new records. Now the situation may repeat, MACD is very bearish and not ready to unfold globally, the RSI may still be in the oversold area for a long time, when the price at this moment will move sideways (blue rectangle). The main thing is to pay attention: the market before moving up makes a puncture down, keep this in mind!