Bitcoin Price Weekly Candle Could Be Omen Of Painful Drop Incoming

Tony "The Bull" Severino

6 years ago

3 mins read

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At the start of April, Bitcoin price rallied through resistance at $4,200 and rocketed nearly $1,000 in the matter of an hour toward over $5,000. Since the massive green candle that many believe “confirmed” a bear market bottom was in, the Bitcoin price has been consolidating between $4,800 and $5,200.

The price movement between the recent daily swing low and high, has caused the weekly Bitcoin price chart to close with a doji, which signals indecision in the market due to an equally fought battle between bulls and bears. However the next candle forms, could paint a painful picture for the price of the leading cryptocurrency by market cap.

Prominent Trader Warns of Evening Star Doji on Bitcoin Price Weekly Chart

Bitcoin price closed with a doji candlestick last night, following a week of consolidation after the previous week’s rally. As one prominent cryptocurrency trader and analyst points out, the current formation is now two-thirds of a way through of an evening star doji pattern.

Dojis are candlestick patters that indicate indecision in a market. When they form at the top of an uptrend, it typically signals a reversal is due. The same is true in the inverse for doji that form at the bottom of a downtrend.

Watch out! HUGE Bitcoin Evening Star Doji Setup on The Weekly! – #BLX chart https://t.co/qXaNJ3RLSs

— MAGIC (@MagicPoopCannon) April 15, 2019

An evening star doji formation is comprised of three candlesticks: a strong upward candle; followed by a doji, showing indecision; then finally a strong downward candle that essentially wipes out all of the gains from the prior rally.

The trader adds that “evening stars often produce several candles of downside continuation on the back of the pattern,” suggesting that not only can the gains from the previous rally through $4,200 be completely erased, the selloff could continue further downward. Such an event would completely destroy any remaining bullish sentiment, and could potentially send the price of Bitcoin down to test new bear market lows.

Is The Doji An Omen Of The Pain To Come to Crypto Investors?

Two weeks ago after the rally, sentiment became the most bullish it’s been in over a year. The sentiment was clearly matched as trading volumes have reached levels not seen since December 2017 when Bitcoin hit its all-time high. Important indicators even flipped bullish, confirming the uptrend.

https://twitter.com/TheCryptoDog/status/1117607852393271303

However, following a short period of consolidation, much of the crypto community has turned bearish, in anticipation of a strong correction. Some of the most prominent crypto personalities, are expecting another “wipe out” of altcoins and Bitcoin before the crypto market begins trending higher.

#bitcoin

What if? pic.twitter.com/S1zaDYDpN4

— Nebraskangooner (@Nebraskangooner) April 12, 2019

Much of the bearish speculation is over exactly where the market is in the current bear cycle. Should the current bear market play out similarly to the 2014-2015 bear market, this recent rally could be rejected, sending Bitcoin down to its finally trading range and painting on the charts the capitulation wick that traders convincingly point to as the signal the bear market is finally over.

Featured image from Shutterstock

Tony "The Bull" Severino

Tony "The Bull" Severino, CMT, is a distinguished figure in the cryptocurrency analysis sector, renowned for his in-depth technical expertise and innovative approach to market trends. As the Head of Research at NewsBTC, Tony leads a team dedicated to providing cutting-edge insights and forecasts, helping both novice and experienced traders navigate the complexities of the crypto market.
A seasoned Chartered Market Technician, Tony's prowess in identifying and capitalizing on market patterns is unmatched. His academic and professional journey in market analysis has firmly established him as a leading authority in technical trading strategies. Tony’s approach is heavily influenced by the principles of Elliott Wave Theory, a method known for its rigorous assessment of investor psychology and price movements.

Beyond his role at NewsBTC, Tony is the visionary founder of CoinChartist.io, an educational platform aimed at demystifying the nuances of cryptocurrency trading. CoinChartist.io serves as a valuable resource for traders seeking to enhance their technical analysis skills. The platform offers a range of learning tools and resources designed to empower traders with the knowledge to make informed trading decisions.

In addition to his educational initiatives, Tony is a prolific author and a dominant voice in the crypto community. He writes the CoinChartist VIP newsletter, a weekly dispatch that has become a staple among crypto enthusiasts, revered for its insightful analysis and actionable trading advice. This newsletter has consistently ranked as a best-seller on SubStack, boasting thousands of subscribers who rely on Tony’s expertise to guide their trading strategies.

Tony is also celebrated for his literary contributions to the field. He is the author of the highest-rated Crypto Trading Journal on Amazon.com, a testament to his ability to communicate complex trading concepts in an accessible manner. This journal is widely regarded as an essential tool for traders aiming to track their progress and refine their strategies.

Before his ascent in the financial analysis world, Tony honed his skills in journalism. His background in this field has endowed him with a unique ability to present intricate market dynamics in a clear and compelling manner, making his insights highly sought after by a broad audience that ranges from casual readers to professional traders.
His professional affiliations underscore his commitment to excellence and continuous learning. As a partner of Elliott Wave International and TradingView, Tony collaborates with other leading experts to enhance his knowledge and skills. His active membership in the CMT Association further aligns him with the highest standards of industry practices and ethics.

Tony’s nickname, "The Bull," aptly reflects his aggressive and optimistic outlook on the cryptocurrency markets. His forecasts often anticipate significant upturns, earning him a reputation for bullish predictions that have frequently led to lucrative outcomes for those who follow his advice.

In summary, Tony "The Bull" Severino, CMT, is more than just a technical analyst; he is a mentor, educator, and innovator whose influence in the cryptocurrency space continues to grow. His dedication to advancing the understanding of market forces and his commitment to providing high-quality, reliable analysis make him a pivotal figure in the world of cryptocurrency trading.