Bitcoin has formed a double bottom, prepare for a strong bounce

Bitcoin has formed a double bottom, prepare for a strong bounce

Bitcoin has formed a really nice reversal pattern, good opportunity to buy for a rally. 

Buy above 9394. Stop loss at 8380. Take profit at 11713. 

Reason for the trading strategy (fundamentally):

The big news event is Tennessee Senate moving ahead to block the trustees of public, post-retirement benefit funds form making investments into cryptocurrencies. The bill if passed, would mark the first time public trustees would be banned form investing in cryptocurrencies for retirement funds. This is a big hit to the cryptocurrency world as it could spark the beginning of other states taking on similar actions.

Reason for the trading strategy (technically):

Price has formed a strong double bottom reversal with breakout level at 9394 (Fibonacci retracement, horizontal overlap support, breakout level) and we hope to see price shoot all the way up to 11713 (horizontal swing high resistance, Fibonacci extension). We do have to be cautious with our intermediate short-term target at 10289 (Fibonacci retracement, horizontal pullback resistance).
Stochastic (89,5,3) is seeing strong support above 4.6% and is rising nicely with good upside potential.


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About the analyst

Desmond Leong provides technical analysis to the largest banks, hedge funds, and brokers whilst coaching hundreds of aspiring traders. He specializes in providing actionable and accurate analysis that utilizes the most advanced theories.

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