BTC/USD pair buyers took advantage of sells’ reduction and formed an upside-down head and shoulders figure in the middle of the third wave, that somehow improves their position in the defending of the key level of 4000-4050. Further is H1 chart:
In case of passing the level of 4350, head and shoulders figure will activate, new buyers will enter the market and we will the durability test of the downtrend.
This scenario is possible but there are some signals which at the moment leave it in doubt. For example, I can suppose that decreasing volume in the rising candlesticks indicates the decreasing buyers’ activity in general. It is especially conspicuous near the neck line in the area of 4350.
At the same time, if you look closer, you can see in m5 chart the initiative volume which has protected itself and tries to develop an uptrend inside the current head and shoulders figure.
In the current trading situation critical volume mass is between between 4150 and 4350 and having passed through the borders the volume will start to shift towards the outbreak. Further is H4 chart.
In general, I consider 3 possible ways of current trend development and enumerate them in descending order. The red line (45% probability) is the decreasing from the current levels down 4050 to 3800, the blue line (35% probability) is the trend border retest before decreasing, the green line (20%) is the implementing of head and shoulders figure and the subsequent break of the downtrend. Further is H4 chart.
I wish you successful trading.
P.S. Did you like my article? Share it in social networks: it will be the best "thank you" :)
Useful links:
- I recommend trying to trade with a reliable broker here. The system allows you to trade by yourself or copy successful traders from all across the globe.
- Use my promo code BLOG to get a 50% deposit bonus on the LiteFinance platform. Simply enter this code in the appropriate field when funding your trading account.
- Telegram chat for traders: https://t.me/litefinancebrokerchat. We are sharing the signals and trading experience.
- Telegram channel with high-quality analytics, Forex reviews, training articles, and other useful things for traders https://t.me/litefinance
The content of this article reflects the author’s opinion and does not necessarily reflect the official position of LiteFinance broker. The material published on this page is provided for informational purposes only and should not be considered as the provision of investment advice for the purposes of Directive 2014/65/EU.
According to copyright law, this article is considered intellectual property, which includes a prohibition on copying and distributing it without consent.
