Bitcoin: 64K To 66K Retrace.
Bitcoin pushed into the 70K resistance area over the previous week and retraced. Those who read my articles and watch my streams should not be surprised. My Trade Scanner Pro take profit price is at 72,632 which was missed by a few hundred points (entry was 62,907 on 5/2). As I continue to remind my followers, CONTEXT is key to navigating this consolidation and it can be summarized by two components: Trend, Support/Resistance. To gauge risk, profit potential and probabilities on shorter time horizons, this is ALL you need to know.
Before I get into more of an explanation, here is my scenario for the coming week. There was a new buy signal off 69K (inside bar see arrow). While a higher low typically should lead to a higher high, the 70K resistance area is still intact and appears to be in play. IF the current candle closes weak and the next candle takes out its low, a test of 66K to 64K becomes more likely (see illustration). This is just ONE scenario of countless that I anticipate based on the price structure and support/resistance on this time frame (CONTEXT).
To be clear, this analysis is meant for those who day trade or swing trade Bitcoin. IF you are only interested in longer time horizons, there is no shortage of 'experts' who will be happy to keep you entertained. So you know, the broader the time horizon, the more RANDOM the outcome.
More is NOT better in this game. I estimate that 99% of the information available to the retail trader/investor is nothing more than misinformation or entertainment. Consuming more of it only leads to confusion and random outcomes. This is why I aim to SIMPLIFY by focusing ONLY on information that provides some ACTIONABLE VALUE.
This is where TREND and SUPPORT/RESISTANCE come into play. Markets TREND, that fact alone is why we can argue that markets are not 100% random. For the retail trader, this is one of the few areas of the market that can provide some kind of advantage even if temporary.
Trend provides a basic gauge of probability. This piece of CONTEXT helps to support/resistance levels into perspective and gives a reference point to better shape expectations. For example, for Bitcoin on this time frame, the broader trend is CLEARLY bullish while the shorter time horizon (going back3 months) is range bound. Recognizing this helps me form reasonable expectations about particular price levels in the future (60K, 64K, 70K, 73K etc).
Support/Resistance levels are inflection points where a particular behavior occurred and MAY occur again in the future. While the levels can be broken randomly, knowing trend helps me anticipate which is likely to hold, and which is likely to break. IF the market chooses to compromise a level unexpectedly (it happens) then I ADJUST to the market NOT get stuck on an opinion. For example, in the context of a broader bullish trend, the 70K resistance on Bitcoin should break, and continues to be vulnerable even though a significant break has yet to occur.
Context helps to shape expectations in line with MARKET generated information. As NEW information reaches the market, price adjusts, and we must also adjust. This phenomenon is rooted in the Efficient Markets Hypothesis. This is why those who think they can forecast the future from looking at a bunch of lines on a chart are fooling themselves and you. As a retail trader/investor it serves us best to evaluate BOTH sides of the market and assign a probability to each side. From there at least we can gauge risk and profit potential as per a chosen time frame more effectively and not be misinformed by others (too much internet).
Thank you for considering my analysis and perspective.
Before I get into more of an explanation, here is my scenario for the coming week. There was a new buy signal off 69K (inside bar see arrow). While a higher low typically should lead to a higher high, the 70K resistance area is still intact and appears to be in play. IF the current candle closes weak and the next candle takes out its low, a test of 66K to 64K becomes more likely (see illustration). This is just ONE scenario of countless that I anticipate based on the price structure and support/resistance on this time frame (CONTEXT).
To be clear, this analysis is meant for those who day trade or swing trade Bitcoin. IF you are only interested in longer time horizons, there is no shortage of 'experts' who will be happy to keep you entertained. So you know, the broader the time horizon, the more RANDOM the outcome.
More is NOT better in this game. I estimate that 99% of the information available to the retail trader/investor is nothing more than misinformation or entertainment. Consuming more of it only leads to confusion and random outcomes. This is why I aim to SIMPLIFY by focusing ONLY on information that provides some ACTIONABLE VALUE.
This is where TREND and SUPPORT/RESISTANCE come into play. Markets TREND, that fact alone is why we can argue that markets are not 100% random. For the retail trader, this is one of the few areas of the market that can provide some kind of advantage even if temporary.
Trend provides a basic gauge of probability. This piece of CONTEXT helps to support/resistance levels into perspective and gives a reference point to better shape expectations. For example, for Bitcoin on this time frame, the broader trend is CLEARLY bullish while the shorter time horizon (going back3 months) is range bound. Recognizing this helps me form reasonable expectations about particular price levels in the future (60K, 64K, 70K, 73K etc).
Support/Resistance levels are inflection points where a particular behavior occurred and MAY occur again in the future. While the levels can be broken randomly, knowing trend helps me anticipate which is likely to hold, and which is likely to break. IF the market chooses to compromise a level unexpectedly (it happens) then I ADJUST to the market NOT get stuck on an opinion. For example, in the context of a broader bullish trend, the 70K resistance on Bitcoin should break, and continues to be vulnerable even though a significant break has yet to occur.
Context helps to shape expectations in line with MARKET generated information. As NEW information reaches the market, price adjusts, and we must also adjust. This phenomenon is rooted in the Efficient Markets Hypothesis. This is why those who think they can forecast the future from looking at a bunch of lines on a chart are fooling themselves and you. As a retail trader/investor it serves us best to evaluate BOTH sides of the market and assign a probability to each side. From there at least we can gauge risk and profit potential as per a chosen time frame more effectively and not be misinformed by others (too much internet).
Thank you for considering my analysis and perspective.
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My discord community: bit.ly/inviteme2
Trade Bybit: bit.ly/bybreg
Tip With ETH: 0x94c9338fc3A9Ba0F1F930BF4e724C0A3EBB8437E
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