BITCOIN: Weekly: 13.03.2021

This week BTC ended with a very decisive Maribozu candle making a new all time high. While it looks like the bullish train will continue endlessly, there are several concerning events that I would like to discuss in my weekly write-up.

Mid Term

The most concerning indicator on the weekly scale is RSI. The coin is greatly overbought on the weekly time frame. As you can see on the chart above, the RSI has completed the Head & Shoulders above 70 and in the last several months negatively correlates with the price. I view this as a sign of an upcoming reversal.

From the candles perspective, it looks like BTC is going to make a new high next week. Taking into consideration the speed of the recent rally, there is a chance for the coin to hit the top in the middle of the week, followed by a reversal that could take multiple months. This would greatly depend on the next weekly candle.

Short Term

The Elliott Wave projection and the channel forecast a quick retrace followed by a final rally into 68000-72000 area, the one that I mentioned in my several previous daily updates.

I am thinking of two main possibilities for BTC for the next week.

  1. If BTC advances really fast and hits the targeted area 68000-72000 in the middle of the week and then retraces, it could form a very bearish candle combo.
  2. If BTC takes its time and advances to about 65000, there would be a good chance for another week of this rally.

In both cases, my attention would be on the weekly and daily candles and their correlation to RSI and few other indicators. My confidence about an upcoming major reversal is growing and I am looking forward to seeing the next week closure which could determine the path for multiple weeks and possibly months.

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