Senkou Span A acting as a major support
Bitcoin (BTC) Gann Cycles of the Inner YearAn indicator that is now a standard part of many trading platforms is the Ichimoku Kinko Hyo – but it is not an indicator; it is a trading system. And within that system are a series of technical tools that make up the entirety of that trading system. Without going into significant detail, the Kumo (Cloud) is perhaps the component of the Ichimoku Kinko Hyo system that is most associated with the system. When price is inside the Cloud, it represents indecision, volatility, and congestion. One of the most potent components of the system is that it tells traders when they should avoid trading.
The Cloud itself is made up of two components: Senkou Span A and Senkou Span B. Of these two levels, Senkou Span B represents the most challenging level for prices to move above or below. Senkou Span A represents significant strength, as well. And it is Senkou Span A that has been the most crucial support level on Bitcoins chart over the past twenty-four days. Specific attention should be made to the most recent 11 trading days. Out of the past eleven trading days, seven have seen the daily candlesticks pierce the bottom of the Cloud (Senkou Span A). Clearly, the short term trend has been to follow the contour of Senkou Span A, but that then brings up an important question. Will price continue to follow the movement of Senkou Span A?
If we are to assume that price will continue to respect Senkou Span A as a support level, then we are about to witness an extremely important event on November 20th, 2019. November 20th, 2019 is when Senkou Span A experiences a significant spike higher. If price does not follow Senkou Span A, then it will more than likely trade flat on the 20th, and drift below the Cloud through time, not price action. We will also observe the Chikou Span drop below the candlesticks as it slides forward in time. When price and the Chikou Span are below the Cloud, those conditions generate an ideal short setup on an Ichimoku chart. But there are essential Gann cycles that could produce a return higher.
Today (November 19th, 2019) marks 120-days since Bitcoin first broke down below the daily Cloud. Today is also 90-days from when Bitcoin dropped below the Kumo Twist on August 21st, 2019. Bitcoin is also within the 144-day cycle – we are 146-days from the 2019 high of $13,848 on June 26th, 2019. November 20th is going to be an exciting and relevant date for Bitcoin and the entire cryptocurrency market as a whole. We are about to witness what will probably the most compelling price action movement for the remainder of 2019. What happens tomorrow will more than likely dictate the remaining trend for 2019 and, indeed, a good portion of the first quarter of 2020.
On a side note, it would be wise to carefully scrutinize any spike that occurs between November 19th and November 25th. More than likely any severe single candle spike up or down will actually yield an inverse move.