An important reminder regarding “resistance/support” levels: If a certain price level provides a lot of resistance going up, it will usually provide a lot of support coming down. Conversely, a price level that provides little resistance going up will usually provide little support coming down.
This is why BTC quickly dropped through the “C” line this last move down, because it quickly passed through it on the way up. The “B” level is much more well-established, which is why it caught BTC this time.
Just something to keep in mind when looking at graphs like this.
BTC’s price seems to have stabilized at the previous “B” support line, which means it is holding on to prior gains. This is one of those 4-steps-forward and 2-steps-back type of situations. Long bull runs have frequent pauses scattered throughout.
Over the long term, BTC’s 4-year cycle is quite solid, as I have explained in my other posts here. We are currently in the “rise-to-a-spike” phase of that 4-year cycle. BTC will hit and surpass $100,000 this year. So consider this pullback as a buying opportunity.
I forgot to mention that today’s drop stopped very close to the previous “B” line – which used to be resistance but then became support. It’s a good sign when previous support levels hold.
The current blue support line for iteration “D” seems to be the same line as iteration “B”. This can happen when a market shoots up too quickly. BTC is just taking a little breather for now. Currently the price is at about the same level as iteration “C” of a week ago. So it’s holding up pretty well.
BTC has punched through resistance line “D”. Upward momentum is strong, and further upside is inevitable.
If it falls back to retest line “D” at $57,500, don’t be worried. It has done that almost every time in the past. It can even drop to the rising support line (blue), and that would be normal. The bull run would still be intact.
The “D” line has been updated to $57,500. I drew the first “D” line prematurely, before BTC had completed its upward spurt. For now, $57,500 should be resistance for a few days (more red dots to come). It should then become support (more green dots to come). When it meets the rising (blue), BTC should then jump higher to the next level.
The same pattern we saw twice already (patterns marked “A” and “B”) seem to have occurred two more times (marked “C” and “D”).
Iteration “C” was really short. We can see how $52,500 acted as resistance three times (red dots). BTC then fell to the blue support line. Having found support at the rising blue , it then finally broke through $52,500, which then acted as support ( green dot ).
This pattern has been recurring quite a lot recently, where a level acts as resistance a few times (all red dots). BTC then falls to the rising support line (all blue dots). It then finally overtakes the resistance line which becomes support (all green dots). When the resistance line (orange) meets the rising (blue), BTC then jumps up to the next price level, and the pattern repeats again.
Currently we are at iteration “D”. This time, $56,600 seems to be the resistance line (right orange line / right red dot). The rising support line (right blue line) seems to have steepened a little bit, which seems to indicate BTC may rise more quickly than it did before.
If the pattern holds true again, we should see BTC stop at $56,600 a few times, and even fall down to the blue rising support line. It should then rise up through $56,600, which will then become support once or twice. From there, we can easily see BTC at $60,000 by around February 25th or 26th or so.
The reason I expect to see $60,000 as the next level is because each level has been rising by about $4,000 ($48,000, then $52,000, then $56,000, next $60,000).