USDCAD 4hour Long- 126pips for T1
- lining up on the 0.786
- Price moving down, however we are looking for a small pull back up
4hourchart
BTC:USD 4 hour chart DAILY UPDATE (day 132)Disclaimer: I just returned from my good friends birthday party and am well above the legal limit.
I have been drinking and my analysis should be taken with a grain of salt. Long story short - resistance at $6,725 has failed to push the price below $6,390 and we are primed for another $750 - $1,000 pump.
Short story long, there is a lot of resistance built up but it isn’t enough at this level. We are too far oversold on the higher time frames to continue dropping further. There is a C-Clamp on the daily and 3 day chart that needs to be rectified and we are too far below the 50 & 200 period MA’s to sustain this drop.
A pump to $7,500 is expecting but it is not something to bet on. We are deep in the trenches of a bear market and preparing for a short sale entry should be the priority. As outlined in the last few posts building at short at or above $7,500 is very attractive.
To make up for the short post see my checklist below:
Horizontal support and resistance: S: $6,508 R: $6,620
BTCUSDSHORTS: turning s into r. Still inside triangle.
Funding Rates: 0.01%
EMA’s (12 & 26): 1d: posturing for bullish cross 4h: crossed at $6K , flattening out and could posture down soon
MA crossovers: bearish
Candlestick analysis: tweezer bottom on daily, and higher lows. Looks like it is cupping around bearish spinning top.
Chart Patterns: head and shoulders could be forming
Ichimoku Cloud: tenkan resistance on 4h. At cloud resistance on 12h. C clamps on daily and 3d.
TD Sequential: 3d: Green 2 1d: Green 1
Visible Range: Mad resistance and unfilled gap at $5,000
50 & 200 MA’s: below 50 & 200 and both are posturing down
BTC Price Spreadsheet:
Bollinger Bands: 1d: consolidating above MA 3d: bouncing off bottom band 1w: bouncing off bottom band
Trendline: waiting slightly under $5k
Fractals: up: $6,800 down: $5,819
On Balance Volume: bear divs w lower high and lower low vs tweezer. Bouncing on weekly
Buy/Sell Sentiment on Trading View: RSI < 50 Stoch overbought
Yesterday’s analysis: TD 8, weekly dragonfly, bitfinex channel, visible range
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BTC:USD 4 hour chart DAILY UPDATE (day 129)Current Outlook
1-2 weeks: neutral-bullish
2 weeks - 12 months: bearish
1-2+ years: Super bullish
Yesterday we went over the reasons why I changed my short term outlook to neutral/bullish for the next 1-2 weeks and today we will narrow in on how far this bounce can go. The last 4 hour candle challenged the resistance cluster at $6,724 and appears to have failed. Resistance came horizontally and from the 200 period MA .
We briefly rallied through before getting shot back down below both points of resistance. The current candle is continuing the pullback and if it fails to support above $6,250 then this bounce will have likely run it’s course.
While the 4 hour chart is looking fairly ugly, the higher time frames still look just fine. The rest of this post will be looking at the daily chart, which still shows plenty of room left to rally.
The daily Ichimoku Cloud shows two key areas of resistance: the Kijun-sen at $7,845 and the bottom of the cloud at $8,045
The TD Sequential is showing a green 5 out of 9 with major resistance at $7,700 (green dotted).
The Visible Range Volume Profile is showing resistance stacked up from here to $8,600 with $8,150 being the most significant.
When multiple indicators are painting the same picture it is usually time to make a big bet. Building a short from $7,770 - $8,150 with stop loss at $8,650 looks like a really good position.
Before than can happen we need to rally through $6,800 and $7,000 resistance. With how bearish this market has been that will be much easier said than done. If we create a new low below $6,250 then I will expect the drawdown to continue before we are able to retest the major areas of resistance outlined above.
Thank you for reading and have a Happy Independence Day! Until next time drink responsibly, eat heartily, be social and smash the follow!
BTC:USD 4 hour chart DAILY UPDATE (day 127)Yesterday we looked at the tweezer bottom on the weekly chart and I expected that to provide the support needed to break through the downtrend line that started on 5/5. We did end up breaking the trend line and now I expect a sustained rally for the next 1-2 weeks.
We have a bullish crossover on the 12 & 26 period EMA’s for the following time periods: 1h, 2h, 3h, 4h, and 6h.
The EMA’s are posturing for a crossover on the 12 hour chart and we are currently testing the 26 EMA on the daily chart for resistance. If we range in between the 12 & 26 EMA’s on the daily chart before getting a crossover then a strong rally would be expected to follow.
The 50 period MA is starting to posture upwards on the 4 hour chart and indicates that a crossover with the 200 period MA is likely in the near future.
We just got a tweezer top on the 4 hour chart combined with a bearish spinning top . That won’t be nearly as powerful as the tweezer on the weekly chart but it could be an indication that this current rally has come to an end.
If we are unable to rally past $6,800 resistance over the next couple days and we create a lower low below $6,275 then I will likely be opening a short immediately.
In the post from yesterday I was expecting a bounce to $7,275 and I still feel good about that projection. Nevertheless I am sitting on my hands and waiting for further development. I remain firmly bearish for the rest of 2018 and would need a perfected setup in order to take on a bullish entry in this market (such as buying LTC at $50).
The Ichimoku Cloud on the daily chart shows the next levels of resistance at $7,879 ( Kijun-Sen ) and $8,094 (Cloud retest). If we do rally back to those prices then I would be viewing it as a high probability short and opening a large position.
Inexperienced traders will be running around like a chicken with it’s head cut off in this market. Do not let that happen to you. Have a plan, then patiently execute it with confidence. Have a backup plan and always be looking at the market from both sides. If you are feeling emotional then take a break and use smaller position sizing next time.
If you want to open a long right now, then why didn’t you do it at $5,800 - $6,000? It's because you don't have enough confidence in your position and are following instead of preparing. If you want to open a short right now I would recommend waiting patiently because this bounce still has plenty of room to go.
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BTC:USD 4 hour chart DAILY UPDATE (day 125)Yesterday we identified a bear flag (red triangle) and adjusted the stop losses based on Bill Williams Fractals from the daily chart. The flag failed to confirm with a breakdown below $5,776. Instead we got a double bottom that led to my stops being triggered on BTC:USD and ETH:USD.
Yesterday was a great example of why I have been saying that shorting alts vs BTC is the safest bet. When BTC pumps in a bear market alts often FOMO back into it and/or have trouble keeping pace. I set a tight stop loss on my ETH:BTC short at 0.0731 which will ensure that position is profitable. That stop has not been triggered even with all of the volatility from yesterday. Trading is very stressful and I like to detach from the markets after getting stopped out. Today I played in a golf tournament and went out for Mexican food and margaritas afterwards. Keep that in mind when reading the analysis below!
For me this weekend is about resetting and going back to the drawing board. I am 99% confident that $5,775 was not the bottom and will be preparing for the next bearish entry. Therefore I will be trying to figure out how much further this dead cat can bounce.
Below is a rough draft of my next entry. I like to start by looking at all of the indicators that have proven to be useful in the past. Always beginning with higher time frames before zooming in.
The visible range volume profile illustrates buying and selling volume for specific price points. This is a very useful tool for determining major areas of resistance and support.
On the daily chart we are seeing large volume at $6,762. That is where there was significant support and we should expect that price to turn into significant resistance.
When zooming into the 4 hour chart we get a more detailed view. It is showing three significant areas of volume at: $6,506, $6,731 and $7,544
The moving averages on the daily chart should also help to determine major areas of resistance. Below are the 50 (green) and 200 (orange) period MA’s. Notice that the 200 period MA is starting to posture downwards. That is a bearish indicator and is why I drew the area of resistance (red box) at $8,800. It should continue moving downwards as the price moves up.
Below is the Ichimoku Cloud on the daily chart with 20, 60, 130, 30 settings. It will illustrate potential areas of resistance with the Tenkan-Sen , the Kinjun-Sen and the Cloud. As you can see the Tenken-Sen has been an area of strong resistance over the past two weeks.
The next levels to watch out for are $7,750 where the Kijun-Sen is waiting and $8,000 where the bottom of the cloud hovers.
Nothing outlined above is a trade recommendation, it is nothing more than going back to the drawing board. Over the next couple days I will be refining my outlook and expect to have more specific trade recommendations.
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BTC:USD 4 hour chart DAILY UPDATE (day 124)Over the past couple days we have been examining the short selling volume as it relates to the price of Bitcoin. I noted that the shorts had fallen off drastically while the price had remained flat/fallen slightly. That told me that the only buyers above $5,900 were short sellers taking profit or getting liquidated.
On day 122 I wrote:
“I am expecting the shorts to continue to decrease down to 22,765, which is where I have drawn the white horizontal line to illustrate support. From there I am expecting a sharp reversal in short sellers and another drawdown in Bitcoin”
The rebound in short sellers led to the lowest daily close since 11/12/2017. That is when I expected to see selling volume increase significantly. Instead we are consolidating into a bear flag (red) at support (white).
The measured move for the flag is $5,590 and it would confirm with a breakdown below $5,882.
If we bounce from here then I am expecting prior support to turn into resistance at or below $6,072.
The stop losses on my short positions have been adjusted based on the Bill Williams Fractals from the daily chart. Those have been move to:
BTC: $6,378
ETH: $451
If you are not in a position then you have a couple options:
(1) You could wait for confirmation of the bear flag from above and enter upon a breakdown of support. The stop loss for that trade would be the top of the flag at $5,943.
(2) Or you can remain on the sidelines in order to start preparing for the next bounce.
BTC
ETH
LTC
I currently have orders to buy LTC at $61.75 | $55.51 | $49.76 | $33.60
I think LTC is the best option for a couple reasons: it has been oversold more than the other two and it offers a better potential ROI at approximately 100%. BTC and ETH would have a target closer to the 50% range.
$50 is also a very strong area of support for LTC. Bitcoin would need to fall to $4,000 - $4,200 and Eth $290 - $305 to reach the same levels of support.
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BTC:USD 4 hour chart DAILY UPDATE (day 123)Yesterday we took a look at the short sellers on Bitfinex in relation to the price of Bitcoin. I noted that the shorts had fallen drastically while the price of BTC remained flat. That told me that the only buyers at this level are short sellers who are covering or getting liquidated.
I predicted the shorts to continue to fall to 22,765 before a sharp reversal. That is where I expected the shorts to pick back up and the price of Bitcoin to fall back down.
The momentum appears to be reversing at 22,800. With how sharply the short sellers have fallen off in the past 48 hours I really would have expected to see the price of Bitcoin rise. Instead it has fallen itself.
I am taking that as a very bearish indication. Once the short sellers are on the rise again it will almost certainly push the price down. I am expecting a breakdown of $5,900 support by 7/1. That is based on the cluster of resistance from the trendline (red), prior support turned into resistance (white) and the 12 period EMA on the daily chart (teal).
The short term EMA's (12 & 26) have a bearish crossover on the following timeframes: 15m, 30m, 1h, 2h, 4h, 6h, 12h, 1d, 3d, 1w.
It is often best to wait for all of the time frames to paint the same picture before making an entry. That is currently the case with the moving average crossovers and I have found that to be one of my most reliable indicators.
The price has been stuck in a range over the past week from $6,100 - $6,300. Once we get a move outside of that zone I am expecting a big move. If you are not currently in a position then opening a small short at the current price and added to it upon a breakdown of $6,100 should work out nicely.
If you have the ability to short alts vs USD or BTC that should be the best bet. I am currently short BTC:USD, ETH:USD, and ETH:BTC.
The stop loss and profits targets are as follows:
BTC
Stop: $6,876
Target: $4,950
ETH
Stop: $556
Target: $360
Stop losses are based on the most recent Bill Williams Fractal from the daily chart. Profit targets are based on trendlines, prior support and FIB retracement levels.
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BTC:USD 4 hour chart DAILY UPDATE (day 122)Yesterday I added to my short position after the hanging man candle on the 4 hour combined with the bearish crossover on the 12 and 26 period EMA’s on the hourly. I have been expecting the breakdown of $5,900 support since last Saturday and am viewing this current bounce as the final short squeeze before the sell off.
The amount of shorts has fallen significantly over the past 5 days. I would expect to see a rise in price to reflect the short sellers covering their positions and/or getting liquidated, however that has not been the case. Bitcoin has remained stagnant while the shorts have been getting rekt. I am viewing this as a bearish divergence.
I am expecting the shorts to continue to decrease down to 22,765 which is where I have drawn the white horizontal line to illustrate support. That could happen in the next few hours or days. From there I am expecting a sharp reversal in short sellers and another drawdown in Bitcoin.
The previous 4 hour candle closed in the shape of a hammer or a hanging man. It is very hard for me to decipher this one. Hanging men come after a rally in the price and a hammer must follow a sell off.
This candle followed a very small rally and that is why some would view it as a hanging man. Prior to the small bounce was a significant sell off and it could be argued that this is a hammer. Which one do you think it is?
The 15 minute chart is painting a pretty clear picture of support turning into resistance.
The bulls are fighting hard to keep the price above $5,900 however they seem to be losing the fight slowly but surely.
The number of traders that are still bullish on Twitter and Reddit is the primary reason why I am certain that we are yet to find a bottom. The profit target for my short remains at $4,950. That is due to trendlines and previous support/resistance. One last thing to note is how well that lines up with the 0.382 FIB Retracement level which is showing up at $4,976.
The stop loss remains $6,876 and that is due to the most recent Bill Williams Fractal on the daily chart.
If you are not in a position then you can start to build a short at the current levels and plan to max out your position upon a breakdown of $5,900. If you have the ability to short alts vs BTC or USD then that should be the safest bet. I am currently short BTC:USD | ETH:USD | ETH:BTC and I sold my spot positions in EOS and LTC.
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BTC:USD 4 hour chart DAILY UPDATE (day 120)Yesterday we looked at the weekly candle as it was getting ready to close and noted that there was still plenty of room left on the downside. One of the most common problems I see with inexperienced traders is the unwillingness to bet on the trend.
A common perception that I am seeing is that the price has already fallen too far to justify the risk:reward of a short. This logic is sound but it is going to be incorrect more often than not. Markets will rise and fall much more than you can imagine and this mind state could cause you to miss out on some great opportunities.
I am going to continue aggressively shorting the market until we see some serious capitulation. Peter Brandt says that he likes to trade in between the 20 yard lines of a trend, and is never concerned with catching the top or the bottom.
In my opinion we just entered field goal range on the 40 yard line and there is still plenty of time to profit from this bear trend. You can go for a field goal by scalping $200 - $500 moves or you could go for the touchdown with a $4,975 target. I am opting for the latter.
A hanging man just closed on the 4 hour chart. It was following a rally in the price and I expect the top of the wick ($6,345) to mark a major point of short term resistance.
We are fast approaching a major resistance cluster which will be coming from the 50 period MA on the 4 hour chart, the 12 period EMA on the daily chart, the downtrend that started on 5/6 (red line) and prior support which is expected to be turned into resistance (white line).
I added to my short at $6,284 and am closely watching for further confirmations where I can add more. As I said yesterday I am viewing this as the last squeeze before eventually breaking down $5,900 support.
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BTC:USD 4 hour chart DAILY UPDATE (day 119)Yesterday we were waiting on the breakdown of support which has held us up since the beginning of February. I had an order set to open a short on BTC as soon as a new low was created below $5,820.
My order triggered a few hours ago at $5,819 and the price quickly reversed from there. We are currently re testing $6,200 for resistance and I am viewing it as a great opportunity to add to my short.
This feels like the last short squeeze before the downward trajectory resumes. If it breaks through $6,300 then I will be looking to add more to my position at $6,424. That is where a cluster of resistance will be waiting from the trendline (red dotted), 12 period EMA on the daily chart and that is where prior horizontal support is expected to turn into resistance.
Today is Sunday and that means the weekly candle only has a few hours left before closing. It is currently taking the shape of a bearish spinning top. The TD sequential shows a 6, which leaves three weeks left of downside before a 1-4 week correction. The Ichimoku Cloud recently had a kumo twist which followed the TK Cross. The next confirmation would be for the price to trade below the cloud.
The only thing that worries me about my short positions is the dragonfly doji which is currently forming on the daily chart above established support. If the current candle closes above $6,000 then that would be a strong indication of a short term reversal and something to keep a close eye on.
I am still using $6,851 as my stop loss and that is based on the most recent Bill Williams Fractal.
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BTCUSD.. Very strong support line but..There is a big change of entering the 5200/4000 but just keep an eye on the chart as always...
And can I ask a question?
"How sold all his coins and tokens 8 hours ago?"
BTC:USD 4 hour chart DAILY UPDATE (day 118)Yesterday we moved the stop loss down on the short positions for the first time. My short on ETH:USD and ETH:BTC has been open since 6-5 and it is a relief to be able to move the stop loss into the money. I use Bill Williams Fractals on the daily chart to manage my stops.
Today we are waiting to see if the major area of support will breakdown below $5,945 and I have been calling for that to happen this weekend. Be ready for a big amount of selling volume to follow if a new swing low occurs.
I have an order set to open a short on BTC:USD as soon as a new low is created. I am going to be playing in a golf tournament today and that order will make sure that I do not miss out on the opportunity. For those of you who are unaware you can do this by setting a stop order if there isn’t currently an open position.
For example: I set a stop loss order to sell BTC at $5,819. Since I do not have an open position that order will trigger to sell BTC on margin, thus creating a short position. That allows me to get the entry I am waiting on without needing to be at my computer. This is a big help when it comes to living a balanced life!
We are currently consolidating at the major area of support and I am expecting the formation of a bear flag to lead to the eventual breakdown.
On the 1 hour chart we can see prior support turning into resistance as well as a shooting star and two hanging men.
The 12 and 26 period EMA’s have made a bearish cross on the 1 hour, 2 hour, 3 hour, 4 hour, 6 hour, 12 hour 1 day, 3 day and 1 week. It is often a good idea to wait until multiple time frames are in alignment before opening a position. It is safe to say that this is currently the case in regards to the moving averages.
If you are still not in a position then there are a couple of entries on the table.
1. Open 100% of your desired position as a short once we breech $5,900 support.
2. Start with 33% of the position when the shorter term moving averages get a bearish cross over - 10 minute, 15 minute etc.
Stop loss is currently $6,851 and the target of $4,950 remains in tact.
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BTC:USD 4 hour chart DAILY UPDATE (day 116)Over the past 10 days I have been calling for a retest of the 12 period EMA on the daily chart. Any time that we get too far away from that moving average a reversion to the mean is very likely. I mentioned that it could come in the form of a sharp bounce, or it could come through days of consolidation. The latter option appears to be the preferred route.
The EMA has been acting as strong resistance over the past 4 days. I think that the bulls need to break through $6,750 before the weekend, otherwise another downturn is highly likely.
We just had a double top on the 4 hour chart which indicates that the next drawdown could be coming sooner rather than later.
We have been trading at a major resistance cluster over the past few days which will be coming to a head in the next 48 hours. The resistance is coming from the downtrend that started on 5/6 (red), established horizontal (white) as well as the EMA mentioned above.
Furthermore we are coming off a shooting star and a hanging man on the daily chart, both of which are good indications that this bounce is exhausted.
Over the past few days I have been suggesting building a short position and/or selling spot at the current levels of resistance. My strategy would be to start with 33% - 50% of your overall position right now and then add at $6,950 - $7,150. If we do not get to $6,950 then I would add the rest of your position upon a new swing low below $6,300. I am short ETH:USD and ETH:BTC. I believe that shorting alts vs USD has the greatest potential ROI and shorting alts vs BTC comes with the smallest amount of risk. My targets of $4,975 for BTC and $300 for ETH remain in tact and I plan on holding onto my short positions until then.
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BTC:USD 4 hour chart DAILY UPDATE (day 115)On 6-11 in the 106th daily update I said that the price of Bitcoin was oversold and said that it is very important not to chase after a move of 10% in less than 24 hours. That was primarily based on how far we had fallen below the 12 period exponential moving average on the 4 hour and 1 day chart.
I said we would either get a bounce to $7,000 - $7,200 or see days of consolidation. Yesterday we were trading at a cluster of resistance, white horizontal combined with the red trend, and a pullback was expected.
Previous resistance turned into support, a higher low was formed and now we are retesting the cluster of resistance. Today the bulls and the bears have some reliable indicators to point to and I expect the resistance to be heavily contested.
Higher low on the 4 hour vs Hanging Man on the daily
Bullish cross on 12/26 day EMA on 6 hour chart vs resistance cluster on Daily chart
C Clamp (indicates price is out of equilibrium/oversold) vs Volume Profile Visible Range (shows strong built up resistance at current price $6750 and at $7,600
Stochastic on 3 day and Weekly (very bullish) vs RSI on Weekly (bear div), Daily (approaching resistance) and 4 hour (at resistance, pictured above)
Deciding Factors
Shooting star on previous 1 hour candle tells me that bears are winning the fight.
When there is a good argument to be made from both sides then it is very important to take into account the overall trend and momentum. We are deep in the trenches of a bear market and the momentum has been overwhelming each reversal attempt.
The Stochastic is the most bullish indicator by far, and could cause for a rally to the $7,600 range. Therefor if you are looking to enter a position I would suggest opening a short with 33% of your desired position at the current level of resistance. Adding 33% at $7,000 and adding the rest at $7,600. If the price doesn't rally to $7,600 then add the rest of your position after a new swing low below $5,875
The short term target of $4,975 is still firmly intact. I am short ETH:USD and ETH:BTC.
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BTC:USD 4 hour chart DAILY UPDATE (day 113)On June 11 in the 106th daily update I said that the price of Bitcoin was oversold and said that it is very important not to chase after a move of 10% in less than 24 hours. That was primarily based on how far we had fallen below the 12 period EMA (teal) on the 4 hour and 1 day chart.
I said we would either get a bounce to $7,000 - $7,200 or see days of consolidation. The latter option was the most bearish option that I saw. It tells me that the market does not have enough demand to create a short term rally. Bears are lining up at each point of resistance and they are winning.
Let’s take a look at the 15 minute chart.
As you can tell the bears seem to be in full control. Steadily breaking down areas of support and strongly holding the areas of resistance. Currently the major area of resistance is $6,500 (white line) and the major area of support is $6,375.
Over the past 5 days the price has consolidated into a triangle (orange) and is currently resisting the 12 period MA on the 4 hour chart. I would still like to see a retest of the 12 day MA before feeling comfortable that the price has returned to equilibrium.
As you can see there is still quite a bit of room between the price and the EMA. This could allow for whales to create a bear trap. I expect a lot of traders have their stop loss set above $6,555 (white line) and/or right above the triangle.
A pump to $6,700 would trigger those stops and also retest the 12 day MA, which I expect to act as strong resistance.
If not in a position then there are some good options still on the table. Keep in mind that these prices are taken from Bitstamp and would need to be adjusted for your exchange.
SEE BELOW!
BTC:USD 4 hour chart DAILY UPDATE (day 112)Over the last week I have been wanting to see the price return to equilibrium after being oversold on the 6/9. For me that would require a retest of the 12 period EMA on the daily chart.
The price could continue ranging between $6,300 - $6,600 until running into the moving average or it could spike up to $7,000 which is where it currently waits. That is where there will be strong resistance which I expect to cause a new low below the $5,979 capitulation on 2/6.
Once a new low is created then I expect a very significant selloff to follow. I am still holding my short and have set up stop loss above the most recent daily fractal ($7,811 for BTC | $613 for ETH). My profit target remains $4,975 and $305 respectively.
If not in a position then now is the time to be proactive while the price continues to work its way towards equilibrium. My strategy has been to scale out of alts, sell spot BTC & ETH and open a leverage short on ETH:USD/ETH:BTC. I am currently fully positioned and feeling great about it.
For those still looking for an entry a few have been outlined below
1) Sell BTC:USD at 12 day EMA. Save some (at least 50%) to sell the 26 day EMA in case price continues to rally. If price doesn't continue to rally then refer to #4 to enter the other 50%.
2) Sell ETH:BTC. Currently at trend and horizontal resistance cluster
3) Sell LTC:BTC. Recently broke major area of support and is consolidating after a bear flag
4) Wait for new swing low below $7,300 and then open short on BTC or ETH.
I am reminded of a Tweet that I read from @PeterLBrandt on twitter that well along the lines of:
“When long, buy the strongest asset in the class. When short, sell the weakest.”
I focus on BTC, ETH and LTC. Right now I would say that LTC is the weakest but I do not have the ability to short it on my exchange. Therefor ETH was my best option. I believe the ETH:USD offers the greatest chance for ROI and shorting ETH:BTC is the safest option.
I will often go weeks without finding a trade that I would take or recommend. Lately there has been an abundance of trades that give me a high confidence interval and offer a great risk:reward.
When I list out 4+ options do not let it overwhelm you. Focus on what you think is the best bet and then carefully consider how much risk you are willing to take. Calculate how much you would lose (if stopped out) and how much you would win (if hitting the target) BEFORE ENTERING. This could help you to decrease your position size or avoid the trade all together. If you feel too anxious or in too much of a hurry to go through a couple simple calculations then you are FOMOing!
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BTC:USD 4 hour chart DAILY UPDATE (day 111)Yesterday I was watching closely as the price of Bitcoin was being squeezed in between the 12 and 26 period EMA’s on the 4 hour chart. It is common to see the price consolidate on top of the shorter term EMA and below the longer term EMA. That is essentially what Bollinger Bands are illustrating when they tighten.
Usually a bullish crossover will follow and we will get a nice pump in the price. In a bull market this can be a very reliable entry signal. However, we are deep in the trenches of a bear market and that is when those signals are often nothing more than a trap. With this much bearish momentum a false signal/peakthrough is very likely.
That is when the crossovers occur and buyers get trapped. In that scenario we would see the moving averages quickly cross back over into a bearish posture and strong resistance from the price where the crossover occurred.
We still have not retested the 12 period EMA on the daily chart and that is what I’ve been waiting for as an indication that we have returned to equilibrium after being oversold on the 6/10.
Yesterday I lined out three possible trades. Option number 2 was to open a short after falling below $6,300. If not in a position today then that still looks like the best bet. If you went with option number 3 and sold the LTC:BTC bear flag then you should already be in the money. The other option was to wait for the bounce to take us to $6,950 and that is still an option for the traders who are more patient. If I wasn't in a position I would hesitate open a short after falling so far and would likely be waiting to sell the 12 & 26 period EMA's on the daily chart.
I am going to a wedding this afternoon and will be away from the charts for the next 24 hours. It will be a great day for me to gain perspective and create memories!
Thank you for your time! Smash the like if you found this helpful, and hit the follow so you don’t miss out on future updates!
BTC:USD 4 hour chart DAILY UPDATE (day 110)Two days ago I made a nice call that had me feeling very prepared for the price pump we got yesterday :
“I firmly believe that a short term bottom lies somewhere in the range of $5,964 - $6,123. From there I expect to see a 1-7 day rally that retests the short term daily EMA’s (12 & 26). If not currently in a trade then I strongly advise against opening a bearish position right now. Wait for the bounce, and/or multiple days of consolidation.”
I was tweeting like a mad man all day saying to sell BTC:USD, ETH:USD, ETH:BTC, and LTC:BTC. In the daily update I outlined those positions ahead of time so that there would be plenty of time for anyone who wanted to position themselves accordingly (refer to to day 107 ).
From here it is still possible to see the pump continue for another 1-5 days. The price is currently being squeezed in between the 12 & 26 period EMA’s and they could make a bullish crossover in the next day or so.
That would create a third higher low and would likely send the price right back to $7,000. If we get a close below the 26 period EMA, or the price falls below $6,350, then I would fully expect this pump to be over.
Entries
If you are not in a position then there are a few options still on the table.
1) Scale into a short or out of spot at upcoming levels of resistance - $6,950 | $7,150
2) Short or sell spot as soon as the price falls below $6,300
3) Short alts vs BTC - LTC is forming a bear flag after breaking down a major level of support
Stop Loss
My philosophy about trading is a simple one. I believe I first learned the sentiment from Peter Brandt on Twitter.
‘Diligently manage stop losses and let the profits take care of themselves.’
I am using Bill Williams Fractals on the daily chart in order to actively manage my stop losses:
BTC:USD - $7,776
ETH:USD - $618
ETH:BTC - 0.0815
LTC:BTC - 0.01601
The stop losses will be moved up once a new up fractal prints on my chart.
It doesn’t appear that the ruling from the SEC will have an impact on the technicals. ETH:USD and ETH:BTC got a nice green candle immediately following the news, but turned around right where the trend suggested.
Thank you for your time! Be sure to comment if you have something to say! Smash the like if you found this helpful! Click follow so that you won’t miss out on future updates!
BTC:USD 4 hour chart DAILY UPDATE (day 109)Today I would like to start with a quick overview from the last couple weeks. I am not one to toot my own horn, but it seems like that is the only way to gain credibility in this space.
5/28 was the last day that I was bullish. I recommended a short term buy at $7,250. That was based on how far the price was from the 12 & 26 period EMA ’s on the 4 hour and daily chart.
I turned bearish the next day because of the Ichimoku Cloud as well as the 50 week MA. Below is the weekly chart. I had been bullish since 4/6 due to the weekly cloud, support from the MA, overleveraged shorts and breaking the down trendline. Once that changed I was forced to join the bad news bears.
Due to the change in my outlook I immediately recommended to exit all bullish positions on the 29th and start preparing for a bearish entry. That was after a nice little pump and the price was trading above $7,400.
My gameplan was (and still is) to scale out of alts, sell spot BTC & ETH and open a leveraged short. I got out of all alts that were in profit or within 2% of breaking even.
On 6/9 I said to sell when the price of Bitcoin was trading above $7,600. By that time I was fully positioned and patiently waiting for the breakdown of the triangle.
I sold ¼ of my BTC at an average price of $7,204 and sold ETH at an average of $582.41.
I opened a 5X leveraged short on ETH:USD from $583.41 - $607.43 and did the same for ETH:BTC from 0.07479 - 0.07847.
Yesterday I was strongly expecting a bounce off of the 4 hour hammer candle to get us back to the short term EMA’s. Here is a quote from the daily update:
“I firmly believe that a short term bottom lies somewhere in the range of $5,964 - $6,123. From there I expect to see a 1-7 day rally that retests the short term daily EMA’s (12 & 26). If not currently in a trade then I strongly advise against opening a bearish position right now. Wait for the bounce, and/or multiple days of consolidation.”
We did get a bounce, but it has not gotten anywhere close to the 12 day EMA and now we are looking at a very significant bearish engulfing candle on the 4 hour. If we turn back around today and go on to create a new swing low below $5,964 then we will likely get to my $4,975 target in the next 2-5 days! That would be the most bearish possibility that I can think of.
It may seem counterintuitive but if that happens it would be a great opportunity to cover my short and open a long position. The harder and faster that the price falls into support the more likely we are to get a significant bounce.
There will be a lot of support waiting to buy Bitcoin at $5,000 and Ethereum at $300. So much so that I will feel fully comfortable trading against the trend with a leveraged position. But that is only if we fall hard enough beforehand.
CONTINUED BELOW...
BTC:USD 4 hour chart DAILY UPDATE (day 108)Over the last couple days I have been calling for a reversion to the mean. I expected to see days of consolidation or a quick bounce back to the 12 & 26 day EMA’s on the daily chart.
In yesterday’s post I outlined 4 potential entries. Two have yet to come to fruition (short BTC after bounce or consolidation) and the other two are already well into the money (short ETH & LTC against BTC).
I also mentioned the bear flag (blue lines) but said that I didn't think it would be able to complete right away due to being oversold at support.
I did not expect us to break down below the 4/1 low of $6,432 before retesting the EMA’s. As it turns out the bearish momentum has carried us right through the trend support (red dotted) and any horizontal support that might have been expected from the prior swing low .
Now I am watching a nice capitulation wick forming on the current candle that could turn into a hammer or a dragonfly . Those candles are my best indicator of an upcoming bounce. However there is still over an hour left before the close. If it closes below $6,200 then I would expect us to continue downward for a retest of the February 6th low at $5,964. That also happens to be the target for the bear flag from yesterday. If it closes above $6,200 then a short term reversal is likely.
If we do not get a bounce off of the capitulation wick that is forming then I expect it to come from an A-B-C-D three drive pattern that bottoms at $5,964. I will not be buying that, nor will I be covering my short. I will simply be planning for a natural flow of price movement and doing my best to be prepared.
I firmly believe that a short term bottom lies somewhere in the range of $5,964 - $6,123. From there I expect to see a 1-7 day rally that retests the short term daily EMA’s (12 & 26). If not currently in a trade then I strongly advise against opening a bearish position right now. Wait for the bounce, and/or multiple days of consolidation.
I am still holding onto my ETH:USD short positions from $583 - $607 and still feel good about my profit target of $300 - $350. I am also short ETH:BTC from 0.074 - 0.07847 and will plan on holding onto that for a while with a trailing stop.
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BTC:USD 4 hour chart DAILY UPDATE (day 107)We have been consolidating into a bear flag pattern over the last 36 hours. However I believe that we are too far oversold for it to complete any time soon (next 1-2 days). I am basing that on how far away we are from the moving averages on the 4 hour chart as well as the daily.
I am still feeling good about my prediction from yesterday , that we will either bounce to $7,000 - $7,200 or consolidate until finding equilibrium. In my opinion we would need to retest the 12 period EMA on the daily chart before we will create a new local low below $6,636.
If not in a position then there should be a couple very good opportunities over the next couple days. Here are a few ideas:
1) Layer orders to sell spot or open a short from $7,000 - $7,200 as outlined in yesterday’s post
2) If we consolidate below $7,000 then sell spot or open short at the 12 & 26 period EMA’s on the daily chart
3) Short ETH:BTC and/or sell spot today. Facing strong resistance from trend and moving averages. Open with 50% of intended position. Add the rest after it breaks below 0.618 fib support (0.07529)
4) Short LTC:BTC and/or sell spot if breaks down below 0.015. Profit target is 0.01
Don’t let yourself get caught up in the fear and doubt that comes with bear markets/big drawdowns. That is how you miss golden opportunities. Right now is the time to be thinking ahead and preparing your next move. Also don't let yourself get overwhelmed with all of the possibilities. Focus on one trade and execute it to the best of your ability.
Be like a chess player who is always thinking multiple moves in advance. Be confident in your plan and stick to your guns.
Be like a sniper who is always checking the conditions and steadily taking aim, but rarely taking a shot. When the target is finally in the crosshairs do not hesitate pulling the trigger!
Thank you for reading! Comment below if you have something to say, smash the follow if you found this helpful and remember that clicking like is good karma!
BTC:USD 4 hour chart DAILY UPDATE (day 106)Yesterday I made a post right as the price was testing the triangle that started forming on 2/6. I expected a small bounce to $7,450 before eventually breaking down that support and creating a new local low. I made a post when the price was at $7,200 and labeled it as a short.
The red arrow that gets printed on my chart didn’t show up until 8 hour later when the price had already fallen to $6,840. I wanted to clarify that I would never recommend opening a short after the price pulled back over 10% in 24 hours. That is when it is very important not to chase. Instead it would be time to prepare for the next possible entry.
Due to how fast and far we have fallen in such a short amount of time I am expect a reversion to the mean. That could come in the form of a bounce to $7,000 - $7,200 or it could come through days of consolidation .
The market is way too bearish to consider longing in this spot. This is the time to plan for the next bearish entry - if you are not already in a position. What I would do is set bids at $6,975 and $7,175 to open a short and/or sell spot. I would make each order for 25% of my trading roll.
If we continue to bounce up to $7,400 then I would add another 25% and set a stop loss anywhere from $7,550 - $7,775 (depending on your risk appetite).
I would also set an order for the rest of my position to trigger if and when the price creates a new local low below $6,624. There would be either 25%, 50%, 75% or 100% of the roll left to enter. If we consolidate instead of bouncing then I would enter 100% after breaking down below $6,624. If the price resisted $7,000 and then pulled back there would be 75% of the roll left to enter. I think you get the idea.
Another good trade that is on the table is shorting the ETH:BTC pair. It hasn’t moved much at all in the last 48 hours but it has been steadily finding resistance at the 50 day MA . Historically shorting alts vs Bitcoin is a very safe bet in a bear market. I am in the process of building a position myself. Using the strategy outlined above I am currently 50% entered and am waiting patiently for further confirmation.
I am also happily holding onto my ETH:USD short which a target of $305.
If the bear market has you feeling down then go outside and get some sun! If that doesn’t help then talk to someone about how you are feeling. As always feel free to shoot me a message if you need someone to talk to!
Until next time trade happily and remember that liking/following is good karma!
BTC:USD 4 hour chart DAILY UPDATE (day 105)On day 93 I made an important update after changing my short term outlook to bearish. At that time were we severely oversold and I called for a “2-14 day rally before heading back downward.”
I expected that to provide a nice window of opportunity to get fully positioned before the next big move downwards. My strategy was to sell spot ETH & BTC, scale out of alts and back into BTC and also open a leveraged short.
I still have a little spot BTC to sell and some alts left that I would love to get out of (at breakeven) but overall I am very happy with my position. I am going to wait for further confirmation before selling the rest of my spot (max 15% of total roll). To execute that order I want to see a lower high below $7,500 or a breakdown of $7,100.
We are currently retesting the triangle that dates back to 2/6 and are getting a few reversal candles. Starting with what can be considered an inverted hammer , a spinning top and a doji . From here I am expecting a bounce to $7,450 and then a breakdown of $7,100. If not in a position there should still be time over the next 6-24 hours to set up a bearish trade.
Until next time trade happily and compound heavily!
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