Bitcoin: WAIT For CPI, FOMC.
All eyes on the CPI report coming out on Tuesday. This is a key report that the Federal Reserve considers when it comes to adjusting interest rates. And right after that, the FED meets on Wednesday to announce their next interest rate decision which is followed by the all important press conference. What does all this mean for Bitcoin? Price action is likely to go NO WHERE until the outcome of these events.
Do NOT make the mistake of thinking you know how the market will price in the outcomes. In this environment, these are BINARY events. Price can go one way or the other, or no where at all if there are no surprises or new pieces of information for the market to price in. This is where opinions can be VERY costly. If you are not in the market, it is best to WAIT until after the event is out of the way. The thing is, this week we have two major events back to back.
The problem with opinions is this: there is no way to know how exactly the market will react, and LOGIC (which is what everyone applies) is NOT effective in a market place that is primarily driven by emotions. For example, CPI may come out high but not as high as "expected" which can be a positive for the markets since it is in line with the Fed's raising rates at a slower pace. The point is, LET THE MARKET FIGURE IT OUT. The market knows all the information in the world, and is highly efficient.
Here is my swing trade plan for Bitcoin: AFTER both events are out of the way, I will be looking for short setups in the low 18Ks. If price happens to break through this area decisively, then I stand aside. While many may argue that Bitcoin is in a "bullish" trend, this only applies to very short time frames. Bigger picture continues to maintain a BEARISH structure. I have no intent to look for longs unless the 15K low is tested again, which is highly likely to break (especially in light of an unexpected catalyst).
Until these events unfold. Bitcoin (and the stock market) is NOT likely to go anywhere. Don't get caught into taking unnecessary action or trade just to trade in this highly uncertain situation. The 17K area is still near the mid point of the 15K to 18K broader lower high consolidation. Price action here is HIGHLY RANDOM.
While I still think it is too early to be taking any major positions for the longer time horizons, I do think it is a good time to build the investment plan. Bitcoin is going to be one of the instruments that I include in my forthcoming speculative growth portfolio which will be comprised of a variety of growth stocks and possibly select alt coins.
Thank you for considering my analysis and perspective. I hope you find it helpful.
Do NOT make the mistake of thinking you know how the market will price in the outcomes. In this environment, these are BINARY events. Price can go one way or the other, or no where at all if there are no surprises or new pieces of information for the market to price in. This is where opinions can be VERY costly. If you are not in the market, it is best to WAIT until after the event is out of the way. The thing is, this week we have two major events back to back.
The problem with opinions is this: there is no way to know how exactly the market will react, and LOGIC (which is what everyone applies) is NOT effective in a market place that is primarily driven by emotions. For example, CPI may come out high but not as high as "expected" which can be a positive for the markets since it is in line with the Fed's raising rates at a slower pace. The point is, LET THE MARKET FIGURE IT OUT. The market knows all the information in the world, and is highly efficient.
Here is my swing trade plan for Bitcoin: AFTER both events are out of the way, I will be looking for short setups in the low 18Ks. If price happens to break through this area decisively, then I stand aside. While many may argue that Bitcoin is in a "bullish" trend, this only applies to very short time frames. Bigger picture continues to maintain a BEARISH structure. I have no intent to look for longs unless the 15K low is tested again, which is highly likely to break (especially in light of an unexpected catalyst).
Until these events unfold. Bitcoin (and the stock market) is NOT likely to go anywhere. Don't get caught into taking unnecessary action or trade just to trade in this highly uncertain situation. The 17K area is still near the mid point of the 15K to 18K broader lower high consolidation. Price action here is HIGHLY RANDOM.
While I still think it is too early to be taking any major positions for the longer time horizons, I do think it is a good time to build the investment plan. Bitcoin is going to be one of the instruments that I include in my forthcoming speculative growth portfolio which will be comprised of a variety of growth stocks and possibly select alt coins.
Thank you for considering my analysis and perspective. I hope you find it helpful.
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