Bitcoin BTC broke out of its nice tidy upward trend channel in the last couple of days and I”m wondering if a head and shoulders reversal is forming. I would look for buying at the neckline but only with a target of the first shoulder. Then shorting on a MACD if we do get to the top of the shoulder.

However, this is Bitcoin and anything can happen. The currency has been rallying nicely and I have to say, it has been performing more and more like FIAT currency over the last year. I wonder if institutional and commercial interests are forcing these patterns. If we do get a proper head and shoulders reversal, we could see Bitcoin go down pretty low returning.

Worries about the dollar

I am still concerned governments are being far too bullish about the recovery and not acting fast enough. Instead of pre-empting inflation rises and surprise interest rate rises the opinion across the board is simply to sit tight. What worries me is when everyone has the same view, it can go horribly wrong. Take the housing market crash. Stock market crashes in the past. To be honest, I actually believe without being a naysayer that if action is not taken fast enough, with the victims of the covid 19 pandemic in terms of jobs and companies going under, we could see a horrendous recession.

$1400 Stimulus cheques are not enough

I have no idea what the government in the US think they are doing sending out this money. It has no hope of solving problems long term. I hear a lot of people are buying Bitcoin with their cheque and investing in stocks and shares, without having the simplest idea of what they are doing. Yesterday, I kid you not gentle reader, I read someone asking if Bitcoin was nearly the 20 period moving average. If you don’t know that, or even where to find that, you should probably not be attempting to trade without doing a lot more reading.

People are buying at the top. People are going to get hurt. Mark my words.

https://www.ukbitcoinblog.com/general-info/bitcoin-btc-head-and-shoulders-pattern-against-usd/