Bitcoin: Price Bounce Back To 100K Area?
Bitcoin has rejected the 105K AREA resistance (wrote about this for two weeks see previous). Risk for longs was very high in that area, if you bought, now you pay. The 100K support was cleared but there is some minor support around the mid to high 96Ks (see arrow). There may be a brief retrace from here back to the low 100Ks over the next day or two. IF the 95K area is cleared, the 90K support can be tested quickly. This is a very high momentum environment, the key to navigating this is paying more attention to the bigger picture and adjusting risk by sizing smaller.
Knowing your environment is key to adjusting effectively. For example, in the recent weeks, price action on smaller time frames has been extreme, moving 500 points in less than a minute. While this may sound great on paper, the problem is getting caught in noise will be very expensive, since the whole point of working on smaller time frames is to utilize larger size. This is where zooming out and getting smaller with the plan of averaging into a position can help to better control risk while minimizing getting caught in noise.
On the daily chart, pay attention to the levels and how price reacts on time frames like the 4 hour (swing trades). Notice the pin bar (arrow) off the 96K area recently. This serves as a point of reference for longs. A reversal candle or strong close on a smaller time frame like 4 hour or 1 hour can prompt you to take a smaller position with a much wider than usual stop (like 2 to 3K points). If Bitcoin fails, and price action stays bearish, you get stopped out but you never add to the position. You lose on small size. IF Bitcoin shows strength off this level instead you can justify an add, and aim for at least 2 to 3K profit objective (100K to 102K area).
The point is you are adjusting your risk to the environment. If there is any skill to this game, it is knowing how to adjust your style, size, risk as the environment changes.
The market gives the clues and that is the best source to acknowledge them from. Bitcoin has been in a consolidation since mid December with the 108K AREA being the high and the 90K AREA being the low. While the general trend is bullish, there are going to be numerous swing trade opportunities within the range, especially at the extremes. In ranging environments BOTH support and resistance levels can hold UNTIL the range eventually breaks. You are better off adjusting to the price action around the major and minor levels within this range rather than trying to forecast the breakout to 200K.
Thank you for considering my analysis and perspective.
Knowing your environment is key to adjusting effectively. For example, in the recent weeks, price action on smaller time frames has been extreme, moving 500 points in less than a minute. While this may sound great on paper, the problem is getting caught in noise will be very expensive, since the whole point of working on smaller time frames is to utilize larger size. This is where zooming out and getting smaller with the plan of averaging into a position can help to better control risk while minimizing getting caught in noise.
On the daily chart, pay attention to the levels and how price reacts on time frames like the 4 hour (swing trades). Notice the pin bar (arrow) off the 96K area recently. This serves as a point of reference for longs. A reversal candle or strong close on a smaller time frame like 4 hour or 1 hour can prompt you to take a smaller position with a much wider than usual stop (like 2 to 3K points). If Bitcoin fails, and price action stays bearish, you get stopped out but you never add to the position. You lose on small size. IF Bitcoin shows strength off this level instead you can justify an add, and aim for at least 2 to 3K profit objective (100K to 102K area).
The point is you are adjusting your risk to the environment. If there is any skill to this game, it is knowing how to adjust your style, size, risk as the environment changes.
The market gives the clues and that is the best source to acknowledge them from. Bitcoin has been in a consolidation since mid December with the 108K AREA being the high and the 90K AREA being the low. While the general trend is bullish, there are going to be numerous swing trade opportunities within the range, especially at the extremes. In ranging environments BOTH support and resistance levels can hold UNTIL the range eventually breaks. You are better off adjusting to the price action around the major and minor levels within this range rather than trying to forecast the breakout to 200K.
Thank you for considering my analysis and perspective.
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Try Trade Scanner Pro for FREE: bit.ly/TSCPRO
Free Signal Every Week: bit.ly/signalwk
My discord community: bit.ly/inviteme2
Trade Bybit: bit.ly/bybreg
Tip With ETH: 0x94c9338fc3A9Ba0F1F930BF4e724C0A3EBB8437E
Free Signal Every Week: bit.ly/signalwk
My discord community: bit.ly/inviteme2
Trade Bybit: bit.ly/bybreg
Tip With ETH: 0x94c9338fc3A9Ba0F1F930BF4e724C0A3EBB8437E
Related publications
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.