Bitcoin: Buy What You Can't See?
Bullish consolidation developing between the 28K and 30K AREA. Highly random price action, within a general resistance area. This unfolds after a week of heavy economic events. The fact that general bullish bias is still intact in terms of price structure is telling. There are a variety of ways to capitalize on this in terms of strategies. One such way is to WAIT for a high probability location and setup.
Many are going to obsess over the price pattern, "wedge" or "pennant" or whatever. You can listen to Captain Obvious if that makes you happy. I prefer to WAIT for what is NOT obvious or present on the chart. I don't react to what I see, instead I anticipate a narrow range of scenarios that the market may or may not present. The particular scenario I am waiting for is this: price probing into the mid to low 27Ks, possibly lower and then presenting a clear reversal pattern. Such a scenario offers a high probability opportunity for a very attractive reward/risk ratio.
Such reversals are common within consolidating markets and has to do with the orders that are caught on the wrong side of the market. Since the broader trend is BULLISH, looking for the long scenario offers a better probability than trying to short the same setup but on the bearish side. That would be the failed high in the low 30K area (upper blue square on chart). At this point I am using the upper blue square as a potential profit objective.
My criteria is very strict and the market may not present me with the opportunity that I am describing. Or the market may test my prices, and break for WHATEVER reason. Markets are HIGHLY random and I trust the price because it accounts for all the known information in the world so that I don't have to.
My trade scanner on the other hand has less strict criteria than me and IF a break out is developing at less than ideal prices, it is likely to generate a notification. I will be open to this since it is based on a specific type of momentum based reversal but I will have to compensate for the less than ideal prices by taking a smaller position.
When it comes to day trades or swing trades, you have to be intimately familiar with the type of market behavior you are attempting to exploit. And most important of all, you have to be able to recognize everything in terms of the risks, NOT the profits. By accepting the random nature of the market, I am better prepared to capitalize on opportunities before they are obvious to the herd. I am able to plan and prepare for what I can't see and I don't need any other information than what is on my charts.
Thank you for considering my analysis and perspective.
Many are going to obsess over the price pattern, "wedge" or "pennant" or whatever. You can listen to Captain Obvious if that makes you happy. I prefer to WAIT for what is NOT obvious or present on the chart. I don't react to what I see, instead I anticipate a narrow range of scenarios that the market may or may not present. The particular scenario I am waiting for is this: price probing into the mid to low 27Ks, possibly lower and then presenting a clear reversal pattern. Such a scenario offers a high probability opportunity for a very attractive reward/risk ratio.
Such reversals are common within consolidating markets and has to do with the orders that are caught on the wrong side of the market. Since the broader trend is BULLISH, looking for the long scenario offers a better probability than trying to short the same setup but on the bearish side. That would be the failed high in the low 30K area (upper blue square on chart). At this point I am using the upper blue square as a potential profit objective.
My criteria is very strict and the market may not present me with the opportunity that I am describing. Or the market may test my prices, and break for WHATEVER reason. Markets are HIGHLY random and I trust the price because it accounts for all the known information in the world so that I don't have to.
My trade scanner on the other hand has less strict criteria than me and IF a break out is developing at less than ideal prices, it is likely to generate a notification. I will be open to this since it is based on a specific type of momentum based reversal but I will have to compensate for the less than ideal prices by taking a smaller position.
When it comes to day trades or swing trades, you have to be intimately familiar with the type of market behavior you are attempting to exploit. And most important of all, you have to be able to recognize everything in terms of the risks, NOT the profits. By accepting the random nature of the market, I am better prepared to capitalize on opportunities before they are obvious to the herd. I am able to plan and prepare for what I can't see and I don't need any other information than what is on my charts.
Thank you for considering my analysis and perspective.
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