Bitcoin is currently in all sorts of trouble and in order to show you how and why we bring you the technical analysis (TA) on a 15-minute BTC/USD chart.
Remember, despite the bearish movement, you can still make money.
To understand how cryptocurrencies can be tricky for short-term trading, let’s see what has already come to pass.
Head and shoulders
The technical analysis chart below clearly shows that Bitcoin has passed through a head and shoulders pattern. Of course, head and shoulders is a reversal pattern, which means that the price should’ve started declining.
However, Bitcoin didn’t travel in that direction and has probably fooled some traders into shorting and, at least temporarily, lose money. But fear not…
So, as we have told you not to fear, it seems that BTC “decided” to take another path towards new lows. Instead of head and shoulders, now, it seems, it has taken a route through a rising wedge pattern.
The rising wedge is also a bearish reversal pattern. Moreover, because the Relative Strenght Index (RSI) shows a divergence in correlation with the price movement. Divergences are, as we know, also signs of trend reversals. Therefore, it seems that Bitcoin could, indeed, sink again.
But how low?
The two supports
Our chart below shows two clear supports for Bitcoin when it eventually breaks down of the wedge:
These two magical light blue lines are where it is safe to take profit for short-term positions. If you what to wait longer, however, the next supports 1, 2, and 3 stand as follows:
How to profit from the bear market
So, now that we have established that there is a very high probability that Bitcoin is going to sink, at least a bit, let’s look at the bright side of life.
By trading cryptocurrency derivatives with leverage, traders can profit from the bear market by going short. That way, traders make an obligation to sell the contract at the predetermined price in the future, profiting from the price spread.
That kind of trading can be done on a variety of trading platforms, and one of the best is definitely BitMEX.
To learn more about BitMEX, visit our review.
You should look elsewhere for investment advice since this is not it even if it looks like it. Cryptocurrencies are known to be extremely volatile and risky speculations. Always do your own research. Maybe even consult an investment professional prior to investing your money.