Let's keep an eye to these levels of BTC

Today ORC sent a sell signal at 7am London time when BTC was at 52,668.

We corrected to 50,392 minutes after.

The signal was valid but it didn't give us enough time for the risky bots to close the open deals. 

For the sake of having realistic expectations be prepared for cases like this. 

Sometimes the SELL signal will be sent early enough giving some room for bots to close the deals before dumping. That's the happy path. 

Some other times it will send a SELL and almost immediately there will be some downside coming. 

You should also expect that during the bull run there will be enough euphoria in the market which can definitely cause that some SELL signals will become false positives. 

Could we correct further?

The SELL signal this morning I think there's still some likelihood to correct further. 

If we don't manage to hold 51K we can head down to 48.6K and 46.6K. 

Those are the levels of the daily Keltner Channels. This indicator was extremely accurate forecasting areas of support throughout the whole bull leg of September 2020 to May 2021. 

Dropping below 46K would be a sign of weakness and could cause a major correction. 

Divergences showing us a correction is still pending

Even if now most people would consider BTC re entering a second bull run leg, we are still seeing loads of divergences showing that for the short term we are running out of steam to keep pushing higher at the same pace we had so far. Expect BTC to at least once or twice a month to take a breather. And expect that to push down ALTs.

In the chart below we can see how divergences are very helpful to understand when we can expect some local tops. 

We can also see we have now failed to stay within the ascending channel. 

We retested the channel resistance twice and each time with a corresponding divergence. 

As I said, the most healthy thing to do for BTC would be to correct but above 46K, so some sideways and then resuming to higher levels. Breaking back inside the ascending channel and heading to 54K would be very bullish for the short term. If we see some bullish RSI divergence soon that should help us identifying potential bottoms.

The more we delay a healthy correction the bigger the correction will become once it materialises.

What would be great?

Not that BTC cares, but my preference for a bullish scenario would be to pay a visit to the lower KC band and then head back up. I would interpret that as paying our duties and validating the bull case. I wouldn't like to see that level broken with a daily candle closed.

You can see below that we are still over the top band of KC. ORC sent us straight to that level :)