A tidal WAVE may be on the horizon! Let’s take a look at Waves vs Bitcoin!
As you can see we have recently broken out of the black dotted downtrend channel we have been in since mid-December. This is clearly a bullish indicator but what awaits for us next?
For now we have to contend with the 23.6 Fib retracement level. The good news is that we have consistently opened above the 12 EMA since the 15th of April. Since the cross over of the 12 EMA and 256 EMA that occurred on 15th of April, we have consistently opened and closed above both these levels up until the test of the 26 EMA that occurred on the 21st and 22nd of April. It is definitely worth mentioning that we actually pierced down below through both these levels on the 21st but alas, they ended up providing us with support.
On the current candle as of today’s writing; we have opened well above the 12 EMA and are currently testing the 23.6% Fib’s resistance. Given we have had a mixture of strong support here (refer around the 18th of December, 6th of January; 22nd of January and to a much lesser extent – the 9th of March ) and strong resistance (refer around 10th of March, 17th of March; and the last 5 days of trading) – we need to look at other indicators to see what is likely to happen.
The MACD is currently trending bullish above the signal line, albeit with not a lot of momentum. The RSI is only at about 60 and starting to trend downwards in another bullish sign; albeit (again) there is not a lot of momentum here either.
Aroon Up is bullish, whilst Aroon Down is pretty flat.
All of these indicators are currently looking fairly indecisive… so let’s look at volume and our EMA’s again. Volume has definitely picked up over the last two weeks. The EMA 12 also crossed over the EMA 26 in a bullish fashion back on 15th of April. Both of these indicators are pointing us towards an imminent breakthrough of the 23.6% Feb retracement level on the proviso we can continue having some volume. All of these buyers from a few days ago are not likely to sell so early; so I can see momentum increasing to the upside.
If we break through the 23.6% Fib level, the 38.2% level should not provide a lot of resistance. This is due to a lot of support found here back around 18th of December, 6th of January, 16th to 23rd of January; and close enough to the 24th of Feb. Therefore if (and when!) we do break through the 23.6% level then a likely move would be to blast up to the 61.8% retrace where we again have some established resistance.
In summary the bullish crossover of the short term moving average over the long term moving average, leads me to believe that the indecisive momentum will move to the upside and push us through the 23.6% Fib once and for all! I won’t be making a trade until we see a confirmed breakout with supporting volume above the 23.6% EMA, though it’s also worth noting that we are currently forming an emerging Bullish Engulfing candle on the weekly chart.
Trade safe!
Cheers
