Short

Bitcoin forecast for more downside

Updated

I believe this recent consolidation to the downside is going to break further down. With the probability of double bottoms not holding and usually breaking down, along with the death cross of the 50day ma crossing below the 200day ma, I do not see any case for the bulls right now. Don't get me wrong, I don't want BTC to go down but I am presenting what the charts tell me and I will try to increase my BTC holdings by shorting it short term until a new bottom is formed.

The arrows basically tell the story but in summary, the TD 9 will bring some relief to the upside to the breakdown level (7650) followed by another 9 count to the downside to test the swing low of $6000 where I believe it won't hold and we will see another big swing down. I see a good bottom being formed within the $4000 - $4500 dollar range, whether it's for the short term or long term I am unsure yet. Lets hope it's the final leg down for BTC.

Note

Looks like the sequential 9 is on it's way to giving the short term upside I was looking for. I will be looking to take profit in the next 24-48hrs with a target of $7650 to $7800 where I will be back to a Bear.

If my target is reached and it holds strong, I will reassess the situation and I may jump back in if it reaches a green 5 for a short term long trade up to a green 7.8 or 9. If this plays out I will have a tight stop loss in place because there is strong resistance points on Fibonacci levels, the $8000 trend line, the downwards trend line off the tops, the 50 and 200 day moving averages and significant breakdown areas that have likely formed resistance too.

If you're not sure about the numbers I have over my candles, you can research it by googling "Thomas Demark Sequential" or "TD Indicator". This indicator costs about 2000/month to get access through a Bloomberg terminal and I find it very useful in Bitcoin. If you're going to trade this indicator though, it's important to understand the rules of the count so you know when a candles close is within the margin of error where the number could be different than otherwise shown in your chart. For example, the close on the 15th of January was only a few dollars off from being an 8 which would have showed a 9 on the following candle giving you the potential for some upside on the next 1-4 candles. if you traded the following reversal candle at the close of 11k you could trade it long with more confidence knowing a 9 took place on some exchanges. Generally a momentum 9 count reverses the price for at least 1-4 candles so if all other TA is supporting this such as the huge reversal doji candle on Jan 17h, and other time frames lining up such as a 4hr sequential 9 taking place on the daily 9 than i consider it a high probability trade and that particular one was.

Trade active

Still short. I got a little worried for my short there at 7150 but there was some swift decline tonight bringing me back to into good profits where I'll continue holding my short from the recent bounce off the 9 (7500). Anyone know if that Mt Gox trustee is still selling? I saw some huge shorts come up in the order book on Bitfinex over the last 24-36 hours and was curious if they would come back. I saw as much as 5k bitcoin at a time being added and removed in the sell book. Usually the order book can't be trusted very much to help your trades but in this case it helped me stay more confident with my short as I was suspicious that this wasn't attempted manipulation but a huge whale trying to time large sell orders when there was higher volume in the buy books.

My target still stands for now but may happen a little bit later which is good as we consolidate at this level the ma's can come down. I have to admit I am a little bias when it comes to any further short calls below the next trend line at the $4500 - 5k range. I have been an investor since June last year and I'm very bullish long term for Bitcoin. I think that several large companies have invested way too much money into BTC (and made just as much or more) to let it fall much lower than 5k. I suspect mining companies such as Bitmain who actually beat Nvidia for profits last Financial year would try to pump the price before it fell into territory where it's too unprofitable to mine. I am going to start buying around 5200 and lower unless I see a significant 9 on the daily/weekly before hand..

Good luck with your trades.

AussieCrypto1

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