The Bitcoin Liquidity Index (BLX) chart is still to print today’s candle. Treat the current price range between $36.5k and $33k as a possible bounce point to turn the bearish momentum bullish.
These are a few things to consider before you buy or invest back into the market. Rudo’s three charts below explain what to look out for.
Chart caption: The BLX BTC (correct at time of publication)
Stop loss alley did as expected, and created a domino effect of stops triggered or liquidations. This leaves a big trade gap in the market between $40k and the current trading price. Expect the market to try and fill this by trading back up to $38-39k. Known as a bull trap, the price can retrace from there – and that is when we can study the charts to locate additional buy zones.
Chart caption: The Bullish Scenario for BLX BTC (correct at time of publication)
(A)The Bullish Scenario for BTC is to consider the current push upwards as short term and to expect max potential at $44-46k. It is important to lock in a higher high.
(B)At this stage this target is marked out on the chart in yellow
(C)Note that it can change if we don’t break this bearish momentum.
(D) At this moment a push back to $38k can be seen as a bullish buy-the-dip scenario. (PLEASE NOTE THAT THIS CAN CHANGE VERY QUICKLY) In support of this, the buying on the next low at point “D” should be with low volume after the price closed on support.
Chart caption: The Dovish Scenario for BLX BTC (correct at time of publication)
Dollar dominance in the crypto market (USDT.D) is tracking true to our previous analysis, with bearish divergence(supporting signs of a bottom locking in.
Bitcoin dominance (BTC.D) is tracking up while BTC is retracing, supporting the overvaluation of price in most alts. New institutional investment could find its way to BTC first, which will allow the BTC.D to track back up before we can enjoy a full-blast alt season. This, however, can only be confirmed once the dominance reaches the target at 44%
