BTCUSD Perspective And Levels: Double Top Appears.

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BTCUSD Update: Double top appears at 5865 level which signals a more significant retrace is coming and in this report I am going to highlight which levels I will be watching for bullish reversal patterns that can lead to a retest of the high.

Besides the price formation (which is very clear) the other factor that is pointing to a more significant retrace is the 1.618 extension at 5742 (this measurement is projected from the 4153 swing low). These levels are far from precise, but usually offer a reliable level for profit targets, and once reached, the market is also more likely to turn. This is why I do not buy highs, especially near these extensions.

On the bigger picture it is clear that this market is strong, but the question is where do you buy the pullback for a swing trade? I am anticipating the 4820 to 4520 support zone (.618 of recent bullish swing). There is a number of overlapping levels in this area and allow for clear definition of risk according to my plan. The 4820 upper level of the zone is also the .382 of the entire bullish swing, and on top of that 4895 is the previous resistance level that was holding price below the 5k level which can now act as a psychological support near 5k. The entire zone is 300 points wide which means I will need some bullish formations before I can determine an actual level to measure risk from, but at least I know that 4520 offers a good starting point. If price breaks below this zone, that will signal more significant weakness and I will reevaluate from there.

There is a minor support at 5234 which is the .382 of the recent bullish swing, but since it is relative to the recent swing, I would rather watch for a break below this level as a signal for the 4820 area retest. Minor bounces off this level can offer some attractive day trading opportunities if you are employing strategies on the smaller time frames.

In summary, we are now entering the week of the forks and will see if the usual "buy the rumor, sell the news" tendency plays out. Since the other coins like ETH and LTC are following this price action to an extent, the levels can serve as a reference point for reversals in the other coins as well (especially on a day trading time frame). I get a lot of criticism for not posting exact trades, but that is not the purpose of my analysis. If a condition fits my swing trade plan, then I will write about it, and if I do not like the price action based on MY criteria, I will write about that too, but that does not mean you have to follow it exactly. Your own risk tolerance, account size, investment goals, trading plan and style are all major factors that should shape how you make decisions, but ultimately the decisions you make have to be from your OWN ideas. The purpose of my analysis is to offer a perspective, or a context that you can use for comparison and as a starting point to develop your own ideas from.

Comments and questions welcome.