Cycle Trading

Bitcoin broke below the day 34 low on Thursday.

Breaking below the day 34 low forms a failed daily cycle and signals the intermediate cycle decline. With Thursday only being day 10, any bearish follow through could see Bitcoin trend lower for another 3 to 5 weeks before forming its DCL/ICL.

However there is chance that this might be a bear trap.

You will notice that RSI 05 did not get oversold when Bitcoin printed its day 34 low. Bitcoin has had a lot of support around the 91 – 92000 level over the past month and RSI 05 is currently not oversold. A bullish reversal on RSI 05 would signal that Thursday was day 44 of an extend daily cycle. We would then look for a swing low and a close above the 10 day MA to label day 44 as the DCL.