Bitcoin Forming 5 Wave Wedge for Bearish Continuation
Wedge patterns are generally a sign of trend continuation when broken to the downside during a downtrend. Bitcoin is currently forming the E wave completion.
Bitcoin on the daily chart is consolidating below a trend break also providing further falls through target 1 in this trade idea.
- Price holding below the 200 EMA
- Price holding below the 50 EMA
- RSI cross through trend line
- E wave of wedge may throw over the trend line.
Support – 10400, 50 EMA, 9850, 9690
Resistance – 10800, 11200
Optimal entry provides the greatest reward to risk ratio while supporting entry is a zone for reversal signals.
Optimal Entry – 10800
Supporting Entry – 10700
Candle Reversals for entry
As traders, it is your job to mitigate the risk and only trade structures that provide high probability and great reward to risk ratios.
If you are not comfortable with defined exit levels, experiment with Moving Averages to help set solid exit rules to protect your capital.
IF: Price breaks above 11080 level and violates 200 EMA – this would suggest the structure is not in our favour and would be wise to reduce exposure or close the trade until a solid signal gives us reasons to re-enter.
Reward / Reward Targets:
Optimal Entry 10800 – Target 1 9850 = Reward to Risk
Supporting Entry 10700 – Target 1 9850 = Reward to Risk