BTC USD Nearing Resistance in the Daily Timeframe
Updated
Here I show stepping stone re-distribution trading ranges for BTC USD in the daily timeframe. From Oct 20, 2021 to Dec 3, 2021, the BTC price was observed in a horizontal re-distribution trading range. The upper and lower boundaries of this trading range are given by the horizontal black dotted lines. The gray shaded areas show support and resistance zones. Significant bars, which help define important areas of support and resistance, are given by the blue shading. The BTC price dropped down to a second, lower horizontal re-distribution trading range. The BTC price was observed in that trading range from Dec 4, 2021 through Jan 21, 2022. Although the BTC price recently has been trending up, it is not likely that the price will significantly exceed the upper bounds of the linear regression channel. The upper and lower bounds of the linear regression channel are given by the solid green and red lines, respectively. The solid black line is the midpoint of the linear regression channel. In this case, I expect the upper bound of the linear regression channel to act as strong resistance and the lower bound of the linear regression channel to act as strong support.
Shown in the bottom panel is the Phoenix Ascending indicator, comprised of the green exponential moving average (EMA), red stochastic relative strength index (sRSI), blue least squared moving average (LSMA), and the grey energy (GE). The ideal short entry occurs when the red sRSI is on the downswing and is about to be contacted by a green EMA on the downswing.
Wyckoff abbreviations: automatic rally (ARa), automatic reaction (ARe), buying climax (BC), failed upthrust (FUT), last point of supply (LPSY), phase A (Ph A), phase B (Ph B), phase C (Ph C), phase D (Ph D), phase E (Ph E), secondary test (ST), selling climax (SC), shakeout (SO), sign of weakness (SOW), upthrust action (UTA).
This is not financial advice. I am not your financial advisor. This is my opinion.
Shown in the bottom panel is the Phoenix Ascending indicator, comprised of the green exponential moving average (EMA), red stochastic relative strength index (sRSI), blue least squared moving average (LSMA), and the grey energy (GE). The ideal short entry occurs when the red sRSI is on the downswing and is about to be contacted by a green EMA on the downswing.
Wyckoff abbreviations: automatic rally (ARa), automatic reaction (ARe), buying climax (BC), failed upthrust (FUT), last point of supply (LPSY), phase A (Ph A), phase B (Ph B), phase C (Ph C), phase D (Ph D), phase E (Ph E), secondary test (ST), selling climax (SC), shakeout (SO), sign of weakness (SOW), upthrust action (UTA).
This is not financial advice. I am not your financial advisor. This is my opinion.
Trade closed: target reached
As previously mentioned, the upper bound of the linear regression channel (linear regression channel with special settings) often serves as resistance. In case, the BTC price met resistance then moved sideways. That’s fine. Often time it takes a lot of patience to find a good time to enter a trade. The ideal time to open a short position occurred on Feb 10. Why? Because the BTC price was again near the upper bound of the linear regression channel and the green EMA moved downward and contacted the sRSI. If you had opened a short position on Feb 10 you could have earned 7-8% profit on the trade. Below is the trade that I actually made.Open: $45,802
Close: $42,778
Profit: 6.6%
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