"Oversold" is a condition weighted by the volatility of the previous defined range. With a very tight trading range an oversold condition will appear significantly MORE oversold than as defined by a longer period. During this most recent drop, it's likely you've read dozens of Bitcoin predictions telling you to buy the dip, this is another one of those posts (but I hope with clearer logic as to why it's a good idea this time.)
When the bellcurve surrounding price action becomes too wide, it requires more force to continue expanding it. The more mass something has, the harder it is to push. Currently, the "mass" surrounding bitcoin is massive, though that doesn't mean much until a condition is met. It's when the bellcurve around price to starts to compress that you can make accurate predictions.
There are only two conditions in the market, trending and not trending. For the 4h chart's 200 period we are defined as "not trending." When an overexpanded bellcurve starts to compress price is driven to the center of the data. Currently for bitcoin that price target is 4,600. Withe the rolling up of the 20 period CCI, it provides solid entry into a solid condition. This trade has an excellent profit ratio.
Your target should be the 4h 200 MA.
Your stop loss should be a local low.
If you're interested in learning more about the concept of "mass" in the markets, check the links in the signature of this post. Trading is a high risk endeavor and you should always do your own research.
When the bellcurve surrounding price action becomes too wide, it requires more force to continue expanding it. The more mass something has, the harder it is to push. Currently, the "mass" surrounding bitcoin is massive, though that doesn't mean much until a condition is met. It's when the bellcurve around price to starts to compress that you can make accurate predictions.
There are only two conditions in the market, trending and not trending. For the 4h chart's 200 period we are defined as "not trending." When an overexpanded bellcurve starts to compress price is driven to the center of the data. Currently for bitcoin that price target is 4,600. Withe the rolling up of the 20 period CCI, it provides solid entry into a solid condition. This trade has an excellent profit ratio.
Your target should be the 4h 200 MA.
Your stop loss should be a local low.
If you're interested in learning more about the concept of "mass" in the markets, check the links in the signature of this post. Trading is a high risk endeavor and you should always do your own research.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.