Bitcoin in the making of a big H&S bear trap?
Pumping 30/40% in 1 day only to pullback almost 100% again, what a market. The days after the pump i kept saying, i don't really trust this move. Went too fast with too little volume. But because the market started to consolidate quite well in the 9K zone, i started to give it credit again, thinking maybe i am seeing this wrong. It's crypto, so anything is possible. Well, in my experience, giving this market too much credit is usually a loosing strategy. Kept saying an ABC to 8600/8800 would be ideal, after a lot of patience it got there. What i asked for upfront was a drop in that zone, but seeing it bounce back up within a few days (otherwise would become less likely). we got that bounce/squeeze to 9200, but it was only to bounce back down again. Probably all because volume just has been too low lately.
Now, when zooming out, we can see the moves are almost identical even, breaking that triangle, then the retest and down again.
After that rejection of 9200, i was starting to get worried a bit, but then the shape of a bullish wedge started to form, giving bulls a chance again. To me it was like a second chance for the bulls. Where they just failed the day i posted my last update. Where yet another short squeeze happened of whales filling up shorts at higher prices only to dump price again.
What got me off guard a bit this time, were alts performing quite well since the big pump. Those moved me from being sceptical about the big pump to neutral. Think i mentioned it several times, that the real test would be, seeing the bull flag play out. That only then would i become really bullish for the coming months. This is only because its Bitcoin. For other markets, it would be a standard long in the bull flag, after such a huge pump. But i have seen Bitcoin doing a lot of nasty things past 2 years, nothing really surpises me anymore. So only a big volume push up would make me bullish, with break of 9200ish zone being the first step.
Why am i saying this? It's to try and make the decision making easier. Because yes, we can all try to go long and short in the meantime, but only seeing this real confirmation would be a moment to go in big, and NOT before. This way you can cut out the hope factor of the trading game. Keeping losses smaller on a loosing trade.
What worries me a bit as well now, is this. Most prob remember this ugly move more than year ago. Doing a great rally (alts were quite bearish though), only to drop 100% again
For now, of course depends on coming days to see if this 7400ish level holds or not. Is this possible H&S here.
First of all, i don't like it's shape at all, volume picture is also not confirming it at all. With volume droppoing on this move down, while it should be moving up.
But the shape is still there and we still have a neckline around 7500, so it's certainly not something to ignore!!
Because of some of the factors here above, the shape and volume, this type of H&S tends to fail and become a trap. So even though i have a lot of fear for a long term bear trend (because of this failed bull flag), this possible trap H&S gives some hope again for the longer term.
For it to become a trap, an important factor is, NOT seeing a big, agressive and high volume drop the first days. So my best guess for the volume, if volume candle crosses that red zone, then it's prob NOT a bear trap. But if we see it stay below the blue, then chances are quite big that its a trap. In between, think i prob favour the trap scenario, but would see it as neutral at first though.
If the trap is real, a movement like i have drawn here is a likely scenario. seeing price reach 6000 zone and eventually seeing bulls slowly take over again. Now this is just an idea, again like the big bull flag, need some confirmation first before assuming it will play out.
So for now, think it's very important to see 7400/7500 hold coming days. Because then the neckline would never break. If market could form a higher low above 7800ish, would actually also make the H&S a trap for the ones who are shorting it here at the neckline support. Maybe seeing OI increase a lot above 7800ish, would indicate this?
Short term, anything below 7950, no need to think trend change might happen. If this 7950ish breaks, would only be a small step. A bigger step would be a break of 8200ish and second 8500ish. But don't want to get ahead of things.
Short term, this might be something to follow. Knowing this market, it's almost getting a bit too obvious that we will drop. So feels as if a short squeeze might be coming soon. But thats just a though, no foundation on that thought yet. This channel might also be something to follow. If we keep moving inside of it, could be a very small bullish sign of some buying here.
I actually did these updates in a row in my channels, with only the chart here below being added here. With this i want to show what bulls need to see before thinking of bullish price action. That is, if we continue to make new lows, the waves down need to become smaller. It's a guess, but it would coincide quite nicely with the higher low bear trap version of the H&S i mentioned above. Seeing a low around 7700. But again, this is a pure guess, this is only something to judge it's value when it's happening, not upfront (like for example with an H&S/wegde?flag).
Now, when zooming out, we can see the moves are almost identical even, breaking that triangle, then the retest and down again.
After that rejection of 9200, i was starting to get worried a bit, but then the shape of a bullish wedge started to form, giving bulls a chance again. To me it was like a second chance for the bulls. Where they just failed the day i posted my last update. Where yet another short squeeze happened of whales filling up shorts at higher prices only to dump price again.
What got me off guard a bit this time, were alts performing quite well since the big pump. Those moved me from being sceptical about the big pump to neutral. Think i mentioned it several times, that the real test would be, seeing the bull flag play out. That only then would i become really bullish for the coming months. This is only because its Bitcoin. For other markets, it would be a standard long in the bull flag, after such a huge pump. But i have seen Bitcoin doing a lot of nasty things past 2 years, nothing really surpises me anymore. So only a big volume push up would make me bullish, with break of 9200ish zone being the first step.
Why am i saying this? It's to try and make the decision making easier. Because yes, we can all try to go long and short in the meantime, but only seeing this real confirmation would be a moment to go in big, and NOT before. This way you can cut out the hope factor of the trading game. Keeping losses smaller on a loosing trade.
What worries me a bit as well now, is this. Most prob remember this ugly move more than year ago. Doing a great rally (alts were quite bearish though), only to drop 100% again
For now, of course depends on coming days to see if this 7400ish level holds or not. Is this possible H&S here.
First of all, i don't like it's shape at all, volume picture is also not confirming it at all. With volume droppoing on this move down, while it should be moving up.
But the shape is still there and we still have a neckline around 7500, so it's certainly not something to ignore!!
Because of some of the factors here above, the shape and volume, this type of H&S tends to fail and become a trap. So even though i have a lot of fear for a long term bear trend (because of this failed bull flag), this possible trap H&S gives some hope again for the longer term.
For it to become a trap, an important factor is, NOT seeing a big, agressive and high volume drop the first days. So my best guess for the volume, if volume candle crosses that red zone, then it's prob NOT a bear trap. But if we see it stay below the blue, then chances are quite big that its a trap. In between, think i prob favour the trap scenario, but would see it as neutral at first though.
If the trap is real, a movement like i have drawn here is a likely scenario. seeing price reach 6000 zone and eventually seeing bulls slowly take over again. Now this is just an idea, again like the big bull flag, need some confirmation first before assuming it will play out.
So for now, think it's very important to see 7400/7500 hold coming days. Because then the neckline would never break. If market could form a higher low above 7800ish, would actually also make the H&S a trap for the ones who are shorting it here at the neckline support. Maybe seeing OI increase a lot above 7800ish, would indicate this?
Short term, anything below 7950, no need to think trend change might happen. If this 7950ish breaks, would only be a small step. A bigger step would be a break of 8200ish and second 8500ish. But don't want to get ahead of things.
Short term, this might be something to follow. Knowing this market, it's almost getting a bit too obvious that we will drop. So feels as if a short squeeze might be coming soon. But thats just a though, no foundation on that thought yet. This channel might also be something to follow. If we keep moving inside of it, could be a very small bullish sign of some buying here.
I actually did these updates in a row in my channels, with only the chart here below being added here. With this i want to show what bulls need to see before thinking of bullish price action. That is, if we continue to make new lows, the waves down need to become smaller. It's a guess, but it would coincide quite nicely with the higher low bear trap version of the H&S i mentioned above. Seeing a low around 7700. But again, this is a pure guess, this is only something to judge it's value when it's happening, not upfront (like for example with an H&S/wegde?flag).
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