Tone Vays suggested that the Bitcoin price movement is likely to continue frustrating some traders.
Vays is a relatively well-known voice in the cryptocurrency industry. He recently made headlines when he questioned Craig Wright over his previous claims about Bitcoin’s whitepaper on the CC forum in London. However, he has also garnered ridicule for his extremely-high fee of 0.3 BTC per hour in offering consulting services.
In the tweet below, Vays states that Bitcoin is not yet done decreasing. He is anticipating a lower low in the area above $7000.
“This move off of $7.7k to as high as $8.5k has not yet convinced me that #BTC is ready to tackle #ATHs. And at the moment I am still anticipating a lower swing low in the low $7k area.”@ToneVays#TRADERSTAKE with @Joe_Saz covering the latest in #cryptohttps://t.co/l9ClY64MtN pic.twitter.com/q6fbsIRndo
— BLOCKTV (@BLOCKTVnews) October 22, 2019
The reasoning for this is that Vays believes that the preceding upward move has been weak and does not convince him that the price is ready to confirm its upward trend. Let’s look at the price movement and analyze how likely this is.
Bitcoin Price: Head and Shoulders
Looking at the daily BTC price chart, we can see that Bitcoin has formed a likely head and shoulders (H&S) pattern. This is a bearish pattern that often indicates further price decreases.
Additionally, we can see that the 50- and 200-day moving averages (MA) are very close to making a bearish cross.
A breakdown from this pattern would likely take us to the low $7000s and finish the correction.
Looking at the wave count, the ensuing breakdown will most likely be the fifth and final wave — which should end inside the support area at around $7200.
However, we do not believe that Bitcoin will break down from the current descending wedge it has been trading in. Rather, it is likely to find support at the support line of the wedge — which coincides with our outlined support area.
Do you think the Bitcoin price will break down from the head and shoulders pattern? Let us know in the comments below.
Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.
Images are courtesy of Shutterstock, TradingView.