Well, that bullish channel uptrend didn't play out quite as cleanly as anticipated. We got rejected hard out of that sloping pattern instead of riding it all the way up toward the 70K target. Prices dropped right back below 65K - blowing through both the consolidation lines I had marked above and below that key level.
Where’s My Support?
No real support is to be found in that area. The selling momentum just overpowered any potential bids trying to hold the range. It was a pretty decisive break of the 65K region that has put us back into some sideways chop for the time being.
From here, I expect that we remain capped under 65K for at least the next several hours, to a couple of days, to a week, but shouldn’t be that long. I don't see enough oomph behind this move just yet to punch directly back above that significant resistance. More likely we'll need to spend some time basing and working off the excess selling flows before attempting another run higher.
That could mean continuing this directionless drift for a bit. Or possibly even forming another lower parallel channel under the one we just broke down from. A new short-term pattern that allows the price to stabilize and reset as participants re-evaluate.
Is 60K Key?
The key level I'll be watching is if we can establish a higher low compared to the recent 60K test. Holding above that could keep the overall uptrend narrative intact, just on a slightly delayed timeline. A break below 60K again would likely negate this as just another bull trap following the same cycles.
For now, I'm standing aside and allowing this all to play out. Not interested in trying to pick a bottom until we get some clearer chart signals. My invalidation points have been breached, so I've taken the majority of my exposure off for the time being.
Once we start carving out a new range or channel to trade, I'll look to re-establish longs in line with the directional bias. But until such time, there's no need to overstay my welcome or force positions. Capital preservation is key during any period.
70K Is Just Hopium
Maybe we never revisit that 70K area and just enter a deeper pullback from here…NOT! This will most likely turn into the continuation pattern leading to new highs over the coming days. I'm staying adaptable to both scenarios for now while waiting for further confirmation either way.
The name of the game is patience and discipline when the path becomes unclear. No need to get chopped up by overzealous/stupid exposures. Let the market come to you as patterns re-emerge, and then be ready to strike accordingly. That's all we can do as reactive traders. I call it Forecast Analysis, but no real forecasts, just relentless adaptability.
