Potential Short position BTC
Updated
I've been tracking Bitcoin's recent movements, and I believe we're seeing a classic Wyckoff distribution pattern play out.
Key Levels and Phases
Phase A (Buying Climax - BC):
We saw a significant buying climax, where the price reached a peak in the upper $70,000s.
An Automatic Reaction (AR) followed, pulling back to around the mid $60,000s.
Phase B:
During this phase, the price oscillated between the mid $60,000s and the upper $70,000s, forming a series of Secondary Tests (ST) and minor Signs of Weakness (SOW).
Notice the increased volatility and volume spikes, typical in this phase.
Phase C:
We might be in Phase C, where a potential Last Point of Supply (LPSY) is forming.
The recent rally failed to break the resistance in the low $70,000s, indicating potential weakness.
Diminishing Volume:
The recent rally to the low $70,000s saw diminishing volume, hinting at a lack of buying interest.
Bearish Signals
Major SOW?
The price broke below the minor SOW level (mid $50,000s) and bounced back, possibly confirming a major SOW.
RSI Divergence:
The RSI is showing bearish divergence with multiple bear signals since March.
Trading Strategy
Short Position:
If the price fails to break above the low $70,000s again and shows bearish signs, consider entering a short position.
Target the previous support levels around the mid $60,000s and mid $50,000s.
Stop Loss:
Place your stop loss just above the low $70,000s to manage risk.
Remember, always do your own research and trade responsibly. Happy trading!
Key Levels and Phases
Phase A (Buying Climax - BC):
We saw a significant buying climax, where the price reached a peak in the upper $70,000s.
An Automatic Reaction (AR) followed, pulling back to around the mid $60,000s.
Phase B:
During this phase, the price oscillated between the mid $60,000s and the upper $70,000s, forming a series of Secondary Tests (ST) and minor Signs of Weakness (SOW).
Notice the increased volatility and volume spikes, typical in this phase.
Phase C:
We might be in Phase C, where a potential Last Point of Supply (LPSY) is forming.
The recent rally failed to break the resistance in the low $70,000s, indicating potential weakness.
Diminishing Volume:
The recent rally to the low $70,000s saw diminishing volume, hinting at a lack of buying interest.
Bearish Signals
Major SOW?
The price broke below the minor SOW level (mid $50,000s) and bounced back, possibly confirming a major SOW.
RSI Divergence:
The RSI is showing bearish divergence with multiple bear signals since March.
Trading Strategy
Short Position:
If the price fails to break above the low $70,000s again and shows bearish signs, consider entering a short position.
Target the previous support levels around the mid $60,000s and mid $50,000s.
Stop Loss:
Place your stop loss just above the low $70,000s to manage risk.
Remember, always do your own research and trade responsibly. Happy trading!
Trade active
More volumeNote
increase volume
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.