Feeble Push to $12k Rejected; More Downside Coming? - Bitcoin Short Term Price Analysis

A small bounce off of $11,000 support yesterday has yielded little for Bitcoin (BTC), as this counter-movement was rejected after barely scraping $12,000 resistance.

This was not a notable movement, and none have come since the abrupt rejection at $13,000 a few days ago. The leading crypto seems to be chewing through a medium timeframe (MTF) accumulation period, a thesis first outlined here yesterday. Volume is weak in the MTF and getting weaker.

The good news is that, according to this thesis, we may expect the rejection to be caught fairly soon - that is, if it has not already been caught.

Looking at the one hour chart (Bitstamp), we see that the leading crypto rather neatly dropped out of a rising wedge pattern before even hitting tough resistance. Price has for now been caught precisely on a previous downtrend line, with a slight doji candle painted.

A weak catch(source: TradingView.com)

Buy volume is not coming in, however, making this small bump look like a pit stop before another short leg down. A more thorough test of the $11,000 could easily happen.

The good news is, it should hold. The larger structure of consolidation is not damaged, and indeed we would expect these movements. Looking at the 12-hour chart below (Coinbase), we see the frame of this potential consolidation.

The present consolidation structure(source: TradingView.com)

Here, the 66 exponential moving average (EMA), which equals the 200 and 33 EMAs on the 4-hour and daily charts respectively, holds the bottom of the structure. This moving average is important because it has held every Bitcoin dip so far during 2019. The top of the structure is generally $13,000, where sellers really start to enter.

Currently, that EMA is at a price of $10,715 - but it is trending up consistently. Only breaking this mark will have us worry about a break in market structure. We also see that $11,000 is a key support of the market structure, and we might expect Bitcoin to be held here as well.

Looking at this entire market structure using the Volume Profile Indicator (VPVR), it is interesting to note that price now rests precisely at the Point of Control (POC), where the most trading has occurred within the frame of reference.

Pretty clear - non?(source: TradingView.com)

This point of inflection in the structure is not far our anticipated market bottom, and we can anticipate a return to this line if it is briefly lost.

As covered here, as long as this important EMA holds, it seems that a long term uptrend remains intact.

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