Happy Monday. It seems the season of change for Bitcoin may be upon us in the near term, which again seems counter-intuitive considering the current news cycle. Nevertheless, it can provide some excellent buying opportunities for cold storage at excellent value as Distribution pushes forward.
With that, let’s get into the Trading Analysis…
The 15M Intraday Chart
Looking at the 15M Intraday Chart, the formation moved into a normal Wyckoff Accumulation from the Selling Climax (SC) at $9,280 through the Buying Climax (BC) at $9,880. The formation then moved into a Phase A Wyckoff Distribution and appeared to experience a Change of Character (CHoCH) in Phase B, signaling a shift into a Wyckoff Re-Accumulation Phase. The first Shakeout drove the PA down to the $9,660 on a Secondary Test (ST) of the low formed at $9,720 on the Automatic Reaction (AR), to establish the trading range for support.
Phase B constrained the trade range between the bookends of support ($9,720 - $9,660), while including a Shakeout Spring down to the $9,540 handle before returning to the trade range before signaling a Chance of Character (CHoCH) and moving into Phase C.
Phase C started with a Creek formation which is expected in Phase C of a Wyckoff Re-Accumulation. Typically we would expect to see a Sign of Strength (SOS) at the conclusion of the accumulation (called a “Jump Across the Creek”), which would appear as a strong upward move in the PA to the Resistance Line, followed by a small pullback to a Last Point of Support (LPS) (generally withing the upper and lower boundaries of resistance) and a subsequent bullish advance. Instead, the formation failed to rally to or above lower resistance line at the $9,860 handle (formed by the earlier Secondary Test (ST) in Phase A) which would suggest the formation was experiencing a Change of Character (CHoCH) and moving into a Phase D Wyckoff Distribution. A second attempt by the PA to push higher stalled out at $$9,780 (which formed a lower high) and a subsequent PA print below the lower support line at $9,660 signaled a Sign of Weakness (SOW).
The 4H Intraday Chart
Looking at the 4H Intraday Chart, the formation has mirrored the PA on the 15 Minute chart constraining accumulation activity inside the lower trade range between $9,740 and $9,660.
Three key takeaways with the 4H Intraday chart which add to the argument a Wyckoff Phase D Distribution is underway (i) when the formation moved to Jump Across the Creek, the initial move down to establish the creek caused the PA to break the support line at $9600, suggesting a bearish bias is now in play on the 4H Chart, (ii) the Upward Thrust (UT) from the Jump Across the Creek failed to at least rise to or surpass the lower resistance line at $9,840 and, (iii) lower highs and higher lows have formed on all PA since the Upward Thrust (UT). All these signs appear to signal a Phase D Wyckoff Distribution is currently underway.
The 1D Chart
Looking at the 1D chart, the formation remains with Phase B of a normal Wyckoff Distribution. Typically, after a Phase B upward thrust, the formation will begin to print lower highs as large interests are net sellers of Bitcoin and have the goal of exhausting as much of the remaining demand as possible.
Currently the formation on the 1D is printing a green candle, which is currently a lower high than the previous candle. My expectation is the 1D formation should continue to print lower highs over the near term before. Congruently, shorter intraday time frames such as the 4H and 15M charts are both signaling a Phase D Wyckoff Distribution is underway as well.
My expectation is for the formation to move lower in the near term, with a current price target at the $8,740 handle, followed by consolidation and distribution around this range before the next leg down.
Always remember this is not trading advice.
Outside of that, Happy Trading.
EDIT: Realized on the short TP, I forgot to modify the horizontal price by 2/3. Updated TP is $9.040.