Bitcoin: Double Bottom At 30K?
Have you bought the recent pullback because it seemed like the right thing to do? Maybe it seemed that way because everyone on Twitter was doing that also? When it comes to any financial market, "conventional wisdom" or what may "feel" right is often the WRONG thing to do, even if the market randomly rewards you for such a behavior.
In my previous article, I wrote about WAITING for a confirmation of a buy signal to develop around the 48K to 50K area support one week ago. The signal NEVER confirmed and guess what? No trade. After that, Bitcoin made its way to the 30K low and we simply STEPPED ASIDE.
As I tell my followers, RISK should always be evaluated FIRST, not reward but that idea goes against human nature. How come none of the other "gurus" or "authorities" were warning about these risks two months ago? Instead I watched video on top of video trying to convince me that these "top 3 alt coins will make me rich in a month". Meanwhile Bitcoin and most alts are off their highs by more than 50%. If this does not teach you a lesson about listening to PEOPLE, I don't know what will.
As of right now, Bitcoin has generated another sell signal (by taking out the previous inside bar low). 30K is the next major support and IF it is decisively taken out, the 23K to 20k area is the nearest major support. Will it go there? I know everyone wants a prediction, but markets don't unfold in absolutes.
As far as swing trade strategy, we don't short Bitcoin, so that side of the equation is not even a question. The rules are simple: wait for price to develop bullish structure around the 30K area for a potential long, or wait for the same process around the 20K area.
In terms of investing, the fundamentals of Bitcoin have not changed so IF you believe in the technology, accumulating some inventory near lows is not a bad idea, the thing is you MUST have a sizing strategy in place, AND a specified investment amount. If you don't you really should not be putting money at risk because you will most likely react emotionally at the least opportune times.
If you look around now, you will see many bears calling for 20K, 15K, etc. While anything is possible, you need to be able to evaluate risk and make reasonable decisions on your own. The crowd REACTS to information, which occasionally results in a random reward and reinforces ineffective behaviors. Stop consuming and reacting to the SAME information as everyone else. Learn to listen to PRICE.
Thank you for considering my analysis and perspective, I hope you found it helpful.
In my previous article, I wrote about WAITING for a confirmation of a buy signal to develop around the 48K to 50K area support one week ago. The signal NEVER confirmed and guess what? No trade. After that, Bitcoin made its way to the 30K low and we simply STEPPED ASIDE.
As I tell my followers, RISK should always be evaluated FIRST, not reward but that idea goes against human nature. How come none of the other "gurus" or "authorities" were warning about these risks two months ago? Instead I watched video on top of video trying to convince me that these "top 3 alt coins will make me rich in a month". Meanwhile Bitcoin and most alts are off their highs by more than 50%. If this does not teach you a lesson about listening to PEOPLE, I don't know what will.
As of right now, Bitcoin has generated another sell signal (by taking out the previous inside bar low). 30K is the next major support and IF it is decisively taken out, the 23K to 20k area is the nearest major support. Will it go there? I know everyone wants a prediction, but markets don't unfold in absolutes.
As far as swing trade strategy, we don't short Bitcoin, so that side of the equation is not even a question. The rules are simple: wait for price to develop bullish structure around the 30K area for a potential long, or wait for the same process around the 20K area.
In terms of investing, the fundamentals of Bitcoin have not changed so IF you believe in the technology, accumulating some inventory near lows is not a bad idea, the thing is you MUST have a sizing strategy in place, AND a specified investment amount. If you don't you really should not be putting money at risk because you will most likely react emotionally at the least opportune times.
If you look around now, you will see many bears calling for 20K, 15K, etc. While anything is possible, you need to be able to evaluate risk and make reasonable decisions on your own. The crowd REACTS to information, which occasionally results in a random reward and reinforces ineffective behaviors. Stop consuming and reacting to the SAME information as everyone else. Learn to listen to PRICE.
Thank you for considering my analysis and perspective, I hope you found it helpful.
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