BItcoin | Don't turn bearish until...
The long signals at $8450 has finally come to an end after Bitcoin hit $9650. As per my recent update, you should have closed some positions at around $10300 and the remaining positions closed at $9650.
As opposed to exiting ALL your positions at $9100 and subsequently having to buy back higher into the resistance at $10,000, I showed you exactly how a proper trailing stop strategy is implemented.
In trading, it’s easy to enter a position and find a price level to set stop-loss. The difficult part (and the part that distinguish between a novice trader and a professional trader) is the ability to hold your positions. There are many strategies to combat this issue and a proper trailing stop is definitely one of them.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
What’s going to happen next?
If you still remember my idea about looking at the Total Market Cap chart as an alternative to identify market structures, you would have prepared yourself for the drop yesterday (Link). Specifically, I told you that the critical resistance for ETH was at around $275.
At this moment it’s difficult to forecast the next market movement. But let’s solve the puzzle by thinking logically so we have the odds in our favour.
1. The uptrend on the 1 hour timeframe was violated after the recent swing low of $9700 was taken out. However, if you look at the daily chart the swing low that will keep the current uptrend intact is still at $9000. This means that if the price ever comes down to $9000, I would be interested to buy "if the price action is good". But if the price pierces through $9000 without hesitation, the next interesting buy area is between $7800 - $8300.
2. The move from 6.4k till now is clearly in an uptrend. Thus, we can reasonably assume the ranging behaviour between 6.5k - 7.7k that took a period of 40 days is in an accumulation phase. If the institutions were to distribute their long positions at the current price level, I need to see a longer period of consolidation happening instead of just a few bearish candles to consider the current uptrend has ended. (Similar to what happened between Jun 19 to Sep 19).
3. On the daily timeframe, the drop on the 15 Feb has a relatively smaller volume comparing to the drop on the 13 Feb. What this possibly mean is that the drop was properly done to scare the weak hands to sell their long positions. Undeniably, the drop is the first warning sign for the buyers but there needs to be more signals to confirm the trend has changed. To provide you with an example of a possible indication of a trend change is that the market starts to consolidate in a range box and subsequently breaks below the low of that range.
4. Alts – some of the alts had significant expansion in volume when price went into resistance. This is usually not a good sign especially when combined with breakdown of a range box. (I will explain this in another post when I do analysis on ETH)
The above thought process gave me the below idea:
The uptrend is still intact on the daily timeframe as long as the $9000 holds (wait for price actions). For a trend to end there needs to have a consolidation phase happening as the institutions needs time to sell their positions to the retail traders. Because the consolidation is yet to happen, there may be an opportunity for us to capture a bounce by buying the bottom of a possible range at $9000. The first target will be near the recent swing high and 2nd target at the next resistance around $11000. As always, I will tell you when I enter the trade.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Please support this idea with your LIKE so I know my time is appreciated. Recently with the increasing number of new followers, the amount of time that I spend answering everyone’s questions are literally taking up all my time after work. I really want to keep it the same way without charging a consultation fee or a subscription fee but the only way to keep it that way is with your LIKE.
For those who aren’t my follower, I am sorry to say but as I have limited amount of time available each day, I will only reply questions or messages from my followers. Hope you understand.
Past analysis (click & play):
Bitcoin, perfect call (300% profits)
Bitcoin, bought between 6.8k - 7.3k (40% profits)
Perfect call from $8450 - 10k (18% profits)
Perfect call on 12k weekly resistance
Bitcoin dropped from 12k to 7k as expected (40% fall)
Bitcoin dropped to 3.5k as expected (40% fall)
Bitcoin, bought $6220 target $8480 (36% profits)
Perfect re-bought target
Education posts:
2618 trade
Top-down analysis
How I draw the trendline
As opposed to exiting ALL your positions at $9100 and subsequently having to buy back higher into the resistance at $10,000, I showed you exactly how a proper trailing stop strategy is implemented.
In trading, it’s easy to enter a position and find a price level to set stop-loss. The difficult part (and the part that distinguish between a novice trader and a professional trader) is the ability to hold your positions. There are many strategies to combat this issue and a proper trailing stop is definitely one of them.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
What’s going to happen next?
If you still remember my idea about looking at the Total Market Cap chart as an alternative to identify market structures, you would have prepared yourself for the drop yesterday (Link). Specifically, I told you that the critical resistance for ETH was at around $275.
At this moment it’s difficult to forecast the next market movement. But let’s solve the puzzle by thinking logically so we have the odds in our favour.
1. The uptrend on the 1 hour timeframe was violated after the recent swing low of $9700 was taken out. However, if you look at the daily chart the swing low that will keep the current uptrend intact is still at $9000. This means that if the price ever comes down to $9000, I would be interested to buy "if the price action is good". But if the price pierces through $9000 without hesitation, the next interesting buy area is between $7800 - $8300.
2. The move from 6.4k till now is clearly in an uptrend. Thus, we can reasonably assume the ranging behaviour between 6.5k - 7.7k that took a period of 40 days is in an accumulation phase. If the institutions were to distribute their long positions at the current price level, I need to see a longer period of consolidation happening instead of just a few bearish candles to consider the current uptrend has ended. (Similar to what happened between Jun 19 to Sep 19).
3. On the daily timeframe, the drop on the 15 Feb has a relatively smaller volume comparing to the drop on the 13 Feb. What this possibly mean is that the drop was properly done to scare the weak hands to sell their long positions. Undeniably, the drop is the first warning sign for the buyers but there needs to be more signals to confirm the trend has changed. To provide you with an example of a possible indication of a trend change is that the market starts to consolidate in a range box and subsequently breaks below the low of that range.
4. Alts – some of the alts had significant expansion in volume when price went into resistance. This is usually not a good sign especially when combined with breakdown of a range box. (I will explain this in another post when I do analysis on ETH)
The above thought process gave me the below idea:
The uptrend is still intact on the daily timeframe as long as the $9000 holds (wait for price actions). For a trend to end there needs to have a consolidation phase happening as the institutions needs time to sell their positions to the retail traders. Because the consolidation is yet to happen, there may be an opportunity for us to capture a bounce by buying the bottom of a possible range at $9000. The first target will be near the recent swing high and 2nd target at the next resistance around $11000. As always, I will tell you when I enter the trade.
----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
Please support this idea with your LIKE so I know my time is appreciated. Recently with the increasing number of new followers, the amount of time that I spend answering everyone’s questions are literally taking up all my time after work. I really want to keep it the same way without charging a consultation fee or a subscription fee but the only way to keep it that way is with your LIKE.
For those who aren’t my follower, I am sorry to say but as I have limited amount of time available each day, I will only reply questions or messages from my followers. Hope you understand.
Past analysis (click & play):
Bitcoin, perfect call (300% profits)
Bitcoin, bought between 6.8k - 7.3k (40% profits)
Perfect call from $8450 - 10k (18% profits)
Perfect call on 12k weekly resistance
Bitcoin dropped from 12k to 7k as expected (40% fall)
Bitcoin dropped to 3.5k as expected (40% fall)
Bitcoin, bought $6220 target $8480 (36% profits)
Perfect re-bought target
Education posts:
2618 trade
Top-down analysis
How I draw the trendline
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.