Some food for thought. With the recent surge there seems to be a whole lot of hopium in the market with regards to a trend reversal, but in my opinion we haven't had a real confirmation just yet in order to begin trading with a totally bullish bias and I'll tell you a few reasons why.
On the Macro: We have not yet posted a higher high yet. I see it being a much less risky trade setup if we wait for BTC to close a higher high above the previous being approximately 9.8k and then catch support there than to just long here and get rekt. Why? because of the technical indicators that are showing signs of a possible large price move to the downside.
Take a look at the above MACD. The red trend line I drew which happens to be at the current level right now shows the amount of times in the past that we've not only went down in price but even posted new lows at these times.
RSI: The RSI has also shown many times to turn back from this range and pretty much crocodile tooth to the downside to oversold territory. I've posted stickers at these spots for you to see for yourself and form your own opinion, and at this very moment we happen to be at that upper level. Coincidence? Hmm. I will be watching this very carefully as the price we end up at as RSI moves to lower levels will help us tremendously with regards to planning our future trade setups.
200MA: I think we could all agree on the fact that the 200MA has been extremely key for BTC with regards to its price behaviour in the past. In the last bear trend we have more than once got rejected at the 200MA, with even a few fake-outs above it only to return back down to a lower low before eventually posting new highs. It's been respected many times in the past, so why negate this information now? It can only go two ways, rejection or a breakout for immense gains so I say let's wait be sure.
Fib Levels: Not only are we currently facing some rejection at the 200MA, you can see that we're right above the .618 golden ratio as well. This is pretty neutral for me but it is something to keep an eye on as we move forward. The 200MA has me slightly bearish which is why I think we will move down under the .618 so this is there just there for a visual reference. How low we go is unknown and is to be determined when we have more information later on.
The bottom line is we're either confirming a trend reversal in the next week or closing in the top of our bear channel, which means a huge risk for a large move to the downside still exists since trading volume doesn't seem to be there either. With all these indicators showing signs of going either bullish or bearish I have no idea why everyone is super hopeful and dead set on the bottom being in. This seems like the almost perfect time for the retail investors to get rekt by the whales, then reaching oversold territory and accumulating for a long and healthy bull run. Again, whether we'll post a new low or just have a nice retracement is to be determined later.
On the flip side, if we close around 9k and maintain this price level for the next week then you'll hear back from me on how I plan to adjust my strategy and further mitigate my risk.
Trading isn't about guessing and catching bottoms and tops, that's called foolish gambling. I'd rather preserve my capital and wait for more confirmations to continue making low-risk high-reward trades. It's easy to assume the bottom is in but the technicals can not be ignored nor can the risk of losing huge before the next bull cycle. Smart and realistic gains via TA with proper risk management over time will always beat speculating on tops and bottoms.
If you liked this Analysis and information please leave a like and share. I would love to hear your feedback and comments on what you think. Let me know whether you're bullish or bearish and why!
Until next time, safe trading :)
On the Macro: We have not yet posted a higher high yet. I see it being a much less risky trade setup if we wait for BTC to close a higher high above the previous being approximately 9.8k and then catch support there than to just long here and get rekt. Why? because of the technical indicators that are showing signs of a possible large price move to the downside.
Take a look at the above MACD. The red trend line I drew which happens to be at the current level right now shows the amount of times in the past that we've not only went down in price but even posted new lows at these times.
RSI: The RSI has also shown many times to turn back from this range and pretty much crocodile tooth to the downside to oversold territory. I've posted stickers at these spots for you to see for yourself and form your own opinion, and at this very moment we happen to be at that upper level. Coincidence? Hmm. I will be watching this very carefully as the price we end up at as RSI moves to lower levels will help us tremendously with regards to planning our future trade setups.
200MA: I think we could all agree on the fact that the 200MA has been extremely key for BTC with regards to its price behaviour in the past. In the last bear trend we have more than once got rejected at the 200MA, with even a few fake-outs above it only to return back down to a lower low before eventually posting new highs. It's been respected many times in the past, so why negate this information now? It can only go two ways, rejection or a breakout for immense gains so I say let's wait be sure.
Fib Levels: Not only are we currently facing some rejection at the 200MA, you can see that we're right above the .618 golden ratio as well. This is pretty neutral for me but it is something to keep an eye on as we move forward. The 200MA has me slightly bearish which is why I think we will move down under the .618 so this is there just there for a visual reference. How low we go is unknown and is to be determined when we have more information later on.
The bottom line is we're either confirming a trend reversal in the next week or closing in the top of our bear channel, which means a huge risk for a large move to the downside still exists since trading volume doesn't seem to be there either. With all these indicators showing signs of going either bullish or bearish I have no idea why everyone is super hopeful and dead set on the bottom being in. This seems like the almost perfect time for the retail investors to get rekt by the whales, then reaching oversold territory and accumulating for a long and healthy bull run. Again, whether we'll post a new low or just have a nice retracement is to be determined later.
On the flip side, if we close around 9k and maintain this price level for the next week then you'll hear back from me on how I plan to adjust my strategy and further mitigate my risk.
Trading isn't about guessing and catching bottoms and tops, that's called foolish gambling. I'd rather preserve my capital and wait for more confirmations to continue making low-risk high-reward trades. It's easy to assume the bottom is in but the technicals can not be ignored nor can the risk of losing huge before the next bull cycle. Smart and realistic gains via TA with proper risk management over time will always beat speculating on tops and bottoms.
If you liked this Analysis and information please leave a like and share. I would love to hear your feedback and comments on what you think. Let me know whether you're bullish or bearish and why!
Until next time, safe trading :)
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.
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.