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Bitcoin Mid- to Long-term analysis + Short-term bearish swing.Bitcoin ( BITSTAMP:BTCUSD ) has been one of the trickiest assets to forecast, until institutions hopped on, and now it's THE trickiest asset to forecast. So I will give my take on it and the factors I'm considering for my mid to long term analysis. I also give a short-term forecast. But since that can change very quickly, keep following this idea for updates. I would like to thank my followers. In less than a month, I went from 4 to 50 followers, and I hope I can provide you quality analysis and discussions. Thanks to all of you. First I will point out that I am bullish on Bitcoin long-term. I believe it can easily touch $200k during this year. I am, however, expecting a correction of about 50% to 60% from the all-time-high in the short-term. Just the usual Bitcoin behaviour, nothing big. The chart shows a possible scenario that looks neat on my chart. Bitcoin, however, has its own way of looking neat. The path I drew is too long to be accurate, so don't take it as a strict guide, but rather to help you identify points of support and reversal. Now let's get to the analysis. One new factor that was absent from the Bitcoin space is institutions, government and regulatory bodies that have recently joined in on the action. Paypal, Square and others are buying big amounts of Bitcoin. The SEC just started prosecuting Ripple, finally! And Tether keeps creating virtual currency, perhaps trying to compete with the Federal Reserve. Anyway, let's dive into each of these: Paypal: Paypal started selling Bitcoin in Oct 2020 to customers in the US. And they are planning to expand internationally soon. Paypal does not allow withdrawal of Bitcoin from their system. You can only buy, keep it there, and sell. Paypal will keep buying Bitcoin as long as they are anticipating demand from their customers. Similarly, they will sell their Bitcoin when customers are selling. They are not interested in taking a position in Bitcoin, neither short nor long. Paypal have to buy and sell over the counter (OTC), and probably in large chunks. That activity does not reflect on the open markets except after a delay. That is called delayed price discovery. Suppose that Paypal bought a large chunk. Then, open markets would suddenly discover after a while that that large chunk of Bitcoin has been removed from circulation. This leads to a sudden spike in price. Likewise, when Paypal sells, some while later, a big sudden plunge occurs. That is how delayed price discovery causes volatility. This demand from customers can be hard to anticipate and can go out of control, especially after Paypal expands its Bitcoin offering internationally. This mean that Paypal will find themselves forced to take a position in Bitcoin. They will have to bet on one direction or the other. Paypal would certainly not like volatility in their balance sheets. They could choose to suspend the service at any time which will create more volatility. They could choose to convert customers' balances from bitcoins to USD at any time and either keep the bitcoin for themselves or sell all of it, creating a huge move in the market, depending on their decision. Keeping it might not necessarily mean it goes up. In short: Paypal will create volatility in Bitcoin , as if that's what we've been missing! Regulation: Almost all Bitcoin gateways are asking for KYC, even individual sellers do, and they even proof of ownership of the Bitcoin wallet. Coinbase already blew any hope of protecting your privacy. They would simply give away information to government whenever requested. It's becoming harder and harder to keep your ownership of Bitcoin private. Paypal not allowing Bitcoin withdrawals is also regulation, and I suspect that it either stems out of Paypal trying to adhere to existing government policy or it is a smart move by Paypal to attract government cooperation and support. The reason I say this is.. imagine this: People can now buy Bitcoin. They can fulfil their curiosity, their investment desires, but at the same time, they cannot withdraw Bitcoins out of the Paypal system. This means that control is in the hands of Paypal. The government would love that. Everything is monitored. No more threats of money laundering, black market trades or siphoning funds to unwanted parties. All of this will keep Bitcoin long-time hodlers to keep hodling. The increase of regulation and the restriction of freedom simply creates incentives for hodling and buying, not selling. In short: Regulation adds value and demand to Bitcoin, not the opposite. Tether: Tether have always been under suspicion of minting more of their virtual currency without real USD cover. They were subpoenaed before and they are always in danger of an SEC crackdown. If an SEC crackdown or any kind of government legal action does occur, the value of Tether currency will fall to the ground. Why? Because people will be selling. And how do you sell Tether? There is no other way except buying Bitcoin or some altcoin with your Tether, which means that all the market cap of Tether will move towards the crypto market, and mostly to Bitcoin of course. In short: Tether crashing will cause a huge rise in the price of Bitcoin, not a crash. Summary of Fundamental Analysis: Bitcoin will remain volatile even after adoption by institutions. Bitcoin is long-term going up, not down. The Short-term Bearish Swing: I expect Bitcoin to retest the Dec 2017 high of around $20k. The sooner it happens the better, because we won't need to worry about it afterwards. I've drawn a path that delineates one point of resistance and three points of support. I drew it a few hours ago when Bitcoin was still at $34870. So far, it has gone up following my path. I know that doesn't count, but if the rest of the path doesn't work, then I hope I can get credit for the first few hours of it XD. Keep watching my updates on this idea as I adjust my short-term view as Bitcoin proves me wrong short-term. And let's hope in the next few hours, it does respect my resistance point. What I'm sure of is that Bitcoin will be volatile, there will be many false breakouts and bull traps, and that $20k is not too low for it to hit in the coming month. What you should do in this case is buy the dips and hold. There are two methods of setting up orders on expected points of support. Say we have three points of support where we expect to catch a dip. The first method is equal division, i.e. to divide the capital you are willing to invest into three equal portions, and buy with each portion as price hits your dip target. The second method, which I favor, is bigger orders as you go lower. This way, you don't miss a buy if it turns out that a higher support was the reversal point, and at the same time, if it does reach your expected bottom, then your average buying price is affected the most by the bottommost buy lowering it more than when using the first method. Summary: Dollar-cost-average, Hodl, and stay safe :)
BITSTAMP:BTCUSDLong
by TechNerdOmar
4
Bitcoin Triangle Points To Test Of 14K?Bitcoin lingers within the 11,600 to 12,300 resistance zone. This can be interpreted as a sign of strength since resistance often asserts itself quickly. As a result, price appears to be developing another triangle which can act as a trend continuation pattern and it may break higher this week. If we get a new buy signal, price is now in a position to test the 14K historical peak that dates back to June of the previous year. This level is also notable because IF price closes decisively above, it will confirm that the current structure is in a Wave 3 configuration. (Wave 3's need to break above Wave 1 in order to confirm). This will prompt us to raise our expectations even further since these motive waves are often the largest and most aggressive within the 5 leg Elliott Wave sequence. Our ideal inflection point is also the same as previously mentioned. The 10,500 area would be a much more attractive location for a new swing trade long (based on our strategy), but the market may not provide such an opportunity. Keep in mind, quality opportunities begin with a well thought out premise and clearly defined risk, they are NOT the result of an emotional reaction to some kind of stimulating information (such as news or infotainment).
BITSTAMP:BTCUSD
by MarcPMarkets
7
Shorting Bitcoin? Probability Says It's A Bad Idea.Bitcoin showing bearish engulfing candle (outside bar) which can be interpreted as a MOMENTUM reversal (not to be confused with a TREND reversal). The broader structure is still BULLISH which means probability continues to favor longs. This does NOT mean we can just buy at any price. The objective is to ANTICIPATE the next inflection point or support level where PROBABILITY FAVORS buying activity. That level is the 10,500 AREA. In order for us to share a new swing trade LONG idea, price not only needs to test this area, but also produce a setup that fits within our rules. If you find yourself caught short from the low or long from near the high, then you are most likely reacting to information. That is the key signature of the herd mentality which is part of human nature. Anyone can learn to read a chart and place orders, but most people aren't even aware that the real obstacle that stands in the way of consistent performance is their own natural thought process. This is a game of understanding your own behavior relative to the herd, and it is NOT intuitive.
BITSTAMP:BTCUSD
by MarcPMarkets
26
Bitcoin: No Action At Range Low Good For Longs?U.S holiday price action appears to be playing it's part in Bitcoin's slow price action, but this doesn't change anything. Bitcoin is in a consolidation within a broader BULLISH trend since April. Price continues to probe range lows which does NOT provide any evidence of progress or TREND on our time frame of interest. Keep in mind weak markets BREAK supports, they don't maintain them for long periods. The 8500 area is the key support that we are referencing in order to anticipate the herd mentality and gauge risk. In this video I will further explain the probability and potential of the current price location and why we continue to manage our swing trade LONG. There is a lot of confusion around the concept of "trend". It is actually a very subjective idea which should be rooted by the TIME FRAME that your strategy utilizes. For example, if you are only interested in a higher frequency of trades, small targets and tighter stops, then a small time frame is appropriate. If you are trying to gauge risk and participate in broader market moves (as in 1000s of points) then small time frames (less than 8 Hrs) will only blind you. Many traders will argue that the "trend" is bearish because of some random structure on a 1 hour chart, but that information carries no weight within the scope of OUR long ONLY swing trade strategy. Testing the 8800 and 8900 areas is not even close to compromising the 8500 support. The fact that buyers continue to step in (tails on recent candles), can be interpreted as strength. As long as this entire range (8500 to 10,400) stays intact, it is likely to act a continuation pattern and since the larger trend is bullish, probability still favors a bullish move (higher lows lead to higher highs). Until this structure changes (like a break of 8500), judging it any other way on this time frame is just asking for lower probabilities. Slow markets like these require a LOT of PATIENCE, and a strong understanding of how price structure shapes expectations. The evidence that carries the most weight continues to point to a bullish outcome, but there is no way to know when this will unfold. A few minor pullbacks into the low of the range is nothing more than NOISE and should not be confused with a trend on this time frame. A surprise catalyst can come out of no where, and next thing you know everyone is "predicting" 20K again. If you want to win, you must be positioned ahead of the herd, not react with it. We will continue to hold our long from 9225 and if it gets stopped out, we will wait for a new signal to go long again (unless price breaks 8500).
BITSTAMP:BTCUSD
by MarcPMarkets
7
Bitcoin: Signal From Range Low = High Probablility Long Setup.Bitcoin is NOW in a much more attractive location when we consider the reward/risk and probabilities based on our long only swing trade strategy. For those who insist we are in a bearish trend, make sure to check the structure on your larger time frames, because there is still nothing bearish about this market (trend is a subjective word that is relative to time frame). In this video I will further explain what we would like to see in order to enter into a new swing trade long. Not much has changed since my previous video. Bitcoin is still range bound, and the entire area of the range is something we view as a broad higher low formation. Price has tested near the range low and established a price point at 8830. This stopped us out of a recent swing trade idea that we shared around the 9625 area. As most novice traders will consider a stop out a negative event, we actually look upon it very positively. Why? Stops SAVE money in the long run. What if Bitcoin went to 8K on some news? I can't tell you how many times a stop loss order has saved us tons of money. If you get frustrated by a stop, that is a sign that you have not been in this game very long. Another thing that makes the stop easier for us to manage is we only had 1% of our capital at risk. Often traders misunderstand sizing and take positions that are proportionally too large for their account, making a stop out much more painful financially AND emotionally. Since the broader trend is BULLISH (defined by the 3800 low to 10,400 high), and price is now rejecting the range low area, this makes for a high probability setup. One reason is many shorts who are mislead by reactive information or small time frames, CHASE the market and sell into locations where there are many more buyers. They get caught, and become buyers as they get stopped out or margined out of their positions. This is the process behind the "fake out" and appears to be occurring now. IF the current candle can close in a bullish configuration, it will prompt us to share a new swing trade idea. A setup off of a range low, combined with the fact that the broader trend is bullish is the recipe for a high probability swing trade AND may even generate enough momentum to break beyond the high of the range as the next leg unfolds. If it doesn't break out, testing the high 9K area is proportionally reasonable which still translates into better reward/risk. Keep in mind, IF 8500 is taken out instead, price is likely to stay within the range for a longer period. Gold has recently behaved in a similar way, and we are going to address how managed our trades during the consolidation and fakes outs in today's webinar.
BITSTAMP:BTCUSDLong
by MarcPMarkets
26
Bitcoin: Still Consolidating, Still Bullish. New Buy Signal?Bitcoin continues to linger in the range. So much for overly dramatic and reactive bearish predictions. Hopefully by now you are beginning to realize that opinions, especially those that are based on emotional tendencies are not helpful to hold onto. In this video I will explain the TECHNICAL reasons why we continue to be bullish, and how we select a price when preparing to share a new swing trade idea. If you review my analysis over a long period, you will notice I am usually bullish. Am I this way because I am trying to fulfill my ego and be "right" OR am I this way because the MARKET is providing EVIDENCE that says probability favors the long side? I evaluate probabilities through the use of price structure, price action and order flow. When these variables turn bearish, my view will also change (and since we have strict policy of not shorting Bitcoin, I will simply step aside.) I repeat this often: you do NOT need to trade both sides of a market in order to produce consistent returns. As for the price action now, there is another bullish pin bar in place (yesterday's candle). Price continues to hold above the 9K area, BUT the inflection point in play is 8500. The pin bar is an adequate setup for a new swing trade long, BUT The environment is conflicting. Lingering near the middle to higher region of the range makes for less attractive reward/risk. For us this means we can still participate, but requires extra compensation for the elevated risk which we accomplish through smaller position sizing. The overall structure is clearly BULLISH because the 8500 and 7695 supports have not been compromised. Until this changes, these technical variables come together and FAVOR a bullish breakout, it is just a matter of time. So the question is do we just buy right now? NO. We use a buy stop and select a price level in ADVANCE that will justify a new swing trade long (plus a stop and targets). The price we choose is one that requires the market to work harder in order to activate the trade. For example, we recently sent out a trade idea with an order in the low 9600 area which never filled. This not only further removes us from the emotional aspects of putting on a trade, it also helps to avoid price noise and many would be stop outs. This is just one aspect of how we follow RULES to navigate the Bitcoin market on the swing trade time horizon. Without such an organized process, it is tough to produce consistent results.
BITSTAMP:BTCUSD
by MarcPMarkets
14
Bitcoin: You Mean It's Not A Short? Again?Bitcoin recently sold off from the 10,400 high resulting in the usual run of the mill overly bearish REACTIVE predictions which may have convinced you to sell. Please realize, it is not their fault that they are unable to see the bigger picture. Reacting to price information is a very common mistake and a mark of inexperience. The first thing we told our followers upon the large bearish candle was DO NOT REACT, instead WAIT for the candle to close, and we will then evaluate from there. Since that close, the bearish momentum has been lackluster to say the least. We did NOT sell and continue to hold a position that is aligned with the bigger picture trend which is? (you should be able to answer that). In this video I will further explain what needs to happen in order to reconfirm bearish momentum and what we anticipate from the recent price action. We work very hard to accomplish one simple thing: remove ourselves from the equation as much as possible when it comes to market timing. That means we evaluate each day with NO opinions, and demand evidence from the market in order to make decisions or adjustments. I emphasize THE MARKET because that is the only source of accurate information we can evaluate. Everything else serves as financial entertainment but no matter how many times I remind people of this, they still can't overcome their NEED for "math and facts" also known as "logic" or "cause and effect". Very large news organizations have done very well thanks to this NATURAL need for order and control. What does this have to do with Bitcoin? There is no logic, all markets operate in the realm of human behavior which CAN be evaluated through EVIDENCE in the form of PRICE ACTION. Since we let price action and order flow be our guides, here's what they are PROVING now: The 9125 area (bearish outside bar low) has NOT been taken out. This means bearish momentum is NOT in play until this event can unfold. IF the level is broken, 8500 continues to serve as our next support and attractive location for a new swing trade long idea. We shared a very aggressive long around the 9600 breakout (a week ago) which reached it's first target and reduced the risk by 1/3 at 10,200 (this info is shared privately). I mention it because this idea is still in play AND favored by the market while it lingers within the 9564 to 10,168 resistance zone. Why? A weak market does NOT linger around resistance zones, it rejects them QUICKLY. The fact that price took out yesterday's inside bar low (new sell signal) and has not followed through further confirms a LACK of selling and hints toward not so obvious buying activity. IF price holds above the 9125 area, it is likely to squeeze higher and test the 10,400 high over the next week. Please keep in mind as long as the 7695 level is not compromised, the broader price structure favors longs. So the next time the bears over react, consider this perspective before letting confusion undermine your action.
BITSTAMP:BTCUSD
by MarcPMarkets
21
Bitcoin: Tough Triangle But Favors Bullish Breakout.The Bitcoin consolidation between 9564 to 10168 resistance zone and the 8500 area support is still in play. As I have been mentioning in previous videos, this pattern is typically a trend continuation pattern, and the bullish trend is STILL intact. In this video I will highlight the context behind the setup we would like to see in order to share a new swing trade long idea. Putting on a trade, at least for us, has more to do with the probability of the location and the reward/risk vs. just taking a trade to "make money". If a setup is of low quality (context is out of line) or reward/risk is unattractive, we would rather stand aside and possibly miss a move. In the case of Bitcoin now, it is gyrating in a consolidation which can produce many false or low quality signals before it breaks out. Since the 7695 support is still intact, the broader trend is defined as BULLISH based on the rules of our LONG only swing trade strategy. With this guide in place, it is reasonable to anticipate a BULLISH breakout, (like the recent breakout in Gold) but there is no way to know when this breakout will occur AND follow through. Triangles (from the Elliott Wave perspective) will often develop 5 legs before breaking and Bitcoin at the moment has developed only 4. That concept can provide some timing benefit in terms of expectations. More importantly, WAITING for a setup in the best location is key. Right now that would be near the 8500 support area or range low, followed by a pin bar or inside bar. It is not a matter of when this setup with the best reward/risk appears, it is all about IF the market offers the opportunity. What if it breaks out without offering such an entry? Then we miss it and wait for the next signal. Consistent performance does not come from chasing trade signals, it comes from WAITING for QUALITY setups as defined by reward/risk and probability.
BITSTAMP:BTCUSD
by MarcPMarkets
24
Bitcoin: Consolidation To Go Higher But When To Buy?Bitcoin has found some support in the lower 9Ks, but is NOT yet providing a clear buying opportunity in terms of price structure and setup. In previous analysis videos I have been anticipating a range bound price formation and that appears to be what Bitcoin is producing at the moment. So how are we going trade this in terms of our LONG only swing trade strategy? In this video I will explain further. Rules produce results, so we trade our rules and nothing else. The bullish inside bar that has developed around the lower 9Ks is typically a buy signal, but that ALONE is NOT enough to justify risk based on OUR RULES. Accounting for CONTEXT is a big factor that helps us better gauge the QUALITY of the buy signal since not all buy signals are equal. For our more aggressive followers we even shared a swing trade idea upon the break of the 9325 level which never triggered (our filtering method helps to further minimize taking low quality setups). So what is the key piece of information that puts this price action in the "step aside" category in terms of our rules? There are 2 factors: the larger magnitude bearish movement off the 10K resistance zone, and that price is now gyrating in the MIDDLE of a consolidation. Even though price is not making progress on the bear side, the current momentum still leans that way. Which means the RANGE LOWS will be the most attractive location in terms of probability and risk/reward for new swing trade long setups. This keeps the 8500 and 7695 levels in focus in terms of inflection points to WAIT for. Does this mean Bitcoin will trade at these levels? That is a question that only Bitcoin can answer, all we can do is prepare for the possibility. ANYTHING can happen, and the element of randomness is high which means we will adjust to a higher price IF the structure makes sense. A failed low or minor double bottom around the high 8Ks would meet this criteria. Typically consolidation patterns like the one developing now (similar to Gold) are trend continuation patterns and the broader trend is still bullish based on RECENT structure. The toughest area to take a trade in these situations is in the middle of the range. Bears are going to insist there is a lower high at 9300, but within a consolidation, this carries no weight. The concept that keeps us out of trouble is this: if the market moves higher without us, we don't lose ANYTHING, all we have to do is wait for the next setup and follow the RULES.
BITSTAMP:BTCUSD
by MarcPMarkets
23
Bitcoin: Not All Buy Signals Are Equal? What We Need To See.Bitcoin didn't sell off like many were ranting about a week ago. Instead, it found support around the 8500 area (like I wrote about) and produced a very aggressive buy signal which we mentioned but did not take around the 9000 area. So you may wonder, if we are so bullish on Bitcoin, why would we not take a new buy signal? It all has to do with the RULES that define our long only swing trade strategy. In this video, I go into further detail about how we don't chase money, and what rules kept us out of the recent buy signal. In the case of Bitcoin, our rules begin with defining a trend relative to a SPECIFIC time frame, followed by a particular technical setup that clearly defines the reward/risk. The trend is bullish, and has been since the 6425 resistance break. So we are interested in long setups and recognize that sell signals carry much less weight in this scenario. There was a new buy signal around the break of the 9K area (inside bar which developed around 8500 support). Why did we avoid this signal? The reward/risk of the location is NOT attractive. The nearest relative resistance (9564 to 10168) is within 500 to 1000 points while our risk is about 1200 points. We have to bet that price will clear a tough resistance zone (lower probability) while facing a max loss of 1200 points if it fakes out. Sure we can get out earlier, but what if the market moves faster than we can adjust our order? It is unrealistic to think we can monitor this (along with all of the other markets we monitor) 24 hours every day. Since there is a lower chance that the buy signal will reach the profit targets that our method calls for, we AVOID the trade and WAIT for a setup that offers a much more attractive reward risk. It is THIS kind of behavior that promotes consistency, EVEN if Bitcoin happens to break out and we miss it. Know why? We don't lose money missing trades, all we have to do is wait for the next opportunity. At this point, Bitcoin is likely to unfold in some sort consolidation pattern similar to Gold over the next week or so. IF we can get a test of the 8500 area or the 7695 key support during this period, we will be much more interested in a long setup. Why? The reward / risk will make a lot more sense. Traders want consistency in there performance, but they are unwilling to develop the habits and routines that produce the results. It all has to do with the fact that their emotions are much more powerful than their ability to reason. The fear of missing out is a powerful motivator, which leads to chasing money and a consistent decline in your account balance. Shouldn't chasing money produce profits? After all, we are all here to make money right? Consistent performance comes from a system of rules that are developed around SOUND market principles and ideas. Following rules means you should be taking trades for the SAME reason EVERY TIME with few exceptions. From there it's all up to the market. A great lesson I learned years ago is that the more you can remove yourself from the equation, the better the results.
BITSTAMP:BTCUSD
by MarcPMarkets
23
Bitcoin Selling Off! And Other Irrelevant Bearish Banter.Bitcoin retraces out of the 9564 to 10,168 resistance zone, but no reason to over react. The resistance zone that has been on my charts for months is a location that favors such a move, and is why we have been reducing our risk by taking partial profits at predetermined targets (8K and 9750). The mistake to avoid here is to get confused by all the bearish hype that will follow (especially the ones who are focused on smaller time frames). The structure of the broader trend is still bullish and in this video I will explain why. When there is a retrace within a bullish trend, what should you be doing? Looking for buying opportunities. Although Bitcoin has yet to produce a new buy signal, we view this as a chance to add back to our long from 5750 (since we now only have 1/3 of the position left) Where are the inflection points? 8500 which was a previous resistance and 7695 which is the key support for the current broader bullish structure. AS LONG AS 7695 is not compromised, Bitcoin is likely to reverse higher, and at least attempt to take out the 10,200 area high. This may take a week or so to play out, but BASED on the price structure and price action, this is the higher probability scenario. What needs to change in order for our outlook to go back to neutral from bullish? IF price takes out 7695 and closes lower. That is the evidence required by our long only swing trade strategy to adjust our expectations. Like I remind our followers regularly, you can't go into this with any kind of opinion, especially for short term timing. The market tells us what to think, and we simply listen to it, not "experts", news, or other obsolete information. What can the next buying opportunity look like? A failed low off of the 8K area would be a very compelling scenario for us to add to our long. Overall, this move does not qualify for a trend change on the TIME FRAME we evaluate. Momentum may be bearish, but that is not the same as the trend. Keeping these variables as separate and distinct pieces of information will help you to better anticipate coming opportunities.
BITSTAMP:BTCUSD
by MarcPMarkets
33
Bitcoin: Mixed Price Action, Waiting It Out.Bitcoin pushing into the 9Ks after printing a bearish pin bar upon Friday's close. Nothing showcases strength more than a market that lingers around a resistance area. With the Bitcoin reward halving on the horizon, all of the coming hype will likely reflect positive sentiment and limit the potential of any bearish signals along the way. This is all good for those who managed to get long when the opportunity was not so obvious (5750 and 7025 were the levels of our swing trade ideas), because NOW is NOT a time to buy. In this video I further explain the concept of wholesale vs. retail prices and why sometimes in order to win, WAITING is the best choice. Our next profit target is at 9750, and then we have one much higher than that. Even though a new buy signal has been activated (break of the inside bar high), we have NO intention of buying more at these levels. Why? The REWARD/RISK is NOT attractive. Consistent performance does not come from chasing profits, it comes from evaluating and managing risk. If the potential of the trade idea presents a relatively greater risk, why would we take such a trade? Even if price goes straight to 10k from here, the nearest reasonable location to place a stop (based on our LONG only swing trade strategy) is around the 7300 key support level. Over time you cannot make money by risking around 1700 points, only to make around 1000 if you happen to be right. Some will argue: why risk 1700 points when you can pull up a 4 hour chart, and find a much closer support level? The levels we calculate are all of the same magnitude. Measuring risk on a 4 hour chart, while projecting the reward on a larger time frame only increases the chances of being stopped out. Both risk and reward potential must be measured in the same magnitude in order to get proportional and reasonable stops and targets. With that being said, IF Bitcoin is going to break out to levels beyond 10K, there will more than likely be continuation patterns or small retrace structures that we can calculate NEW risk parameters from, and that's when it can make sense to buy at higher levels. So until Bitcoin retraces to an attractive support (7300) or presents a continuation pattern, we do nothing but let our winners run to our predetermined targets. The market chooses the outcome, all we do is adjust and watch.
BITSTAMP:BTCUSD
by MarcPMarkets
11
Bitcoin: Let Your Winners Run.Weak markets do NOT linger around resistance areas, they sell off quickly. That is what I regularly remind our followers who are still long Bitcoin from 5750 and 7025. Is price in a vulnerable area? Sure, but until it produces a clear sell signal on the time frame relative to our LONG only swing trade strategy, there is nothing to do but let the winner run. In this video I further explain this rationale, and evaluate the reward/risk from current levels. NOW is NOT the time to be buying, but rather taking partial profits, and letting the market play out as it chooses. Even though there have been two continuation buy signals since the 7025 long idea, the probability of the location still favors a bearish reversal, BUT that does NOT guarantee that it will unfold that way. Higher lows often lead to higher highs and the recent price structure in this market is nothing but higher lows, and that cannot be overlooked in light of the conflicting location. So which carries more weight? I go with a higher lows, because like I mentioned before, weak markets do not linger around resistance levels. That is a sign of strength that many continue to ignore, and why I am anticipating a push into the low 8Ks rather than a bearish move at this point. The object here is to reduce RISK, while giving the market a chance to reach our second and third targets. Many do not realize, profits are out of our control and are more inline with being random, while risk is something we can fully control. That is why we place all of our profit targets at the time of the buy signal, and remove as much of our emotions from the process as possible. If Bitcoin turns bearish here, and it can come out of no where, we will NOT react. Our stop is in place, and it is up to the market to do the rest. One reason why many get caught in the noise is because they are mixing day trade expectations with larger magnitude levels and information. The nature of the time frame you trade MUST be accounted before BEFORE you enter the market, do not mix day trades with swing trades (topic of today's webinar).
BITSTAMP:BTCUSD
by MarcPMarkets
19
Bitcoin: What Proof Do We Need To Become Bearish?Bitcoin price structure continues to favor a push to higher prices. Although the 7300 level has not yet been cleared, the fact the price continues to flirt with resistance is a sign of strength based on the criteria that we evaluate. UNTIL the market confirms a change in the balance of order flow, we will continue to look for strength. In this video I explain what a confirmed change looks like in order for us to change our expectations from bullish back to range bound. Key Point: For the LONG only swing trade strategy that we employ, near term price structure carries meaningful weight. The recent series of higher lows (5700 area, 6500 area) represent strength and point to the greater probability that price pushes to a higher high (8K area). We have been managing a swing trade from 5750 and recently shared a more aggressive idea at 7025. The structure is our guide and we give the market a chance to let the probabilities play out UNLESS the structure changes. The key here is letting the market PROVE itself and not asserting and acting on our own opinions or feelings about what the market should do. That is why we make it very clear that we do NOT react to noise. The 7300 to 8K zone is a resistance zone where selling activity and a potential reversal are a possibility. And we consider this conflict in light of the bullish structure. At some point the MARKET will choose which way the order flow imbalance will sway. As long as the key support levels of 6425 and 6K stay intact, we maintain our bullish outlook and will NOT be distracted by price noise, or others who tend to over react to information that is much less relevant to our time frame. Waiting for the market to produce PROOF to confirm an idea is key to an effective process when it comes to timing. Reacting to information instead of WAITING and ANTICIPATING is a sure way to empty your account. A reaction is usually rooted in a fear, either of missing out or of losing money. That type of behavior is what leads to the herd mentality and has little to do with "being informed" or logic.
BITSTAMP:BTCUSD
by MarcPMarkets
6
Bitcoin: New Buy Signal And One Simple Rule.Bitcoin: Noise in the markets comes in many forms: price noise, inflexible opinions, hype, etc. It is one thing to consume it for intellectual entertainment, but taking action or making decisions on such information is NOT helpful at all for your trading account. There are many moving parts when it comes to evaluating a market, no matter what mix of fundamental and technical information you choose. The key is to have a set of rules to filter out the adverse effects and bias of human nature. In this video I explain why we believe price structure FAVORS longs, and where to anticipate bullish order flow IF selling activity increases from here. I will also touch on one simple rule that we employ in our long only swing trade strategy. Key Point: Low 7K resistance area has asserted itself, BUT price is more likely to push higher in its next bullish retrace. Why? The 6425 level was a key resistance that once taken out, offered some kind of PROOF that the balance of order flow leans more toward the bullish side. The recent indecisive price action is consistent with this idea so far. Sell offs are not "stop and go", fear is a powerful motivator and buyers do not appear to be getting absorbed around the current price level. This will NOT be obvious on any oscillator, or any other random art on a chart. It is a concept that is based on price structure, proportions and forecasting methods that project forward, NOT focus on looking back. Does this mean price can't pull back to 6K? No, but until Bitcoin provides evidence for that scenario to be likely, it is an event that we assign a low probability. We can do all the analysis in the world and it will not change the fact that markets are highly random. That means things look one way one minute, and then they change. Rules are what allow us to qualify opportunities and filter NOISE. One of our simplest rules: using predetermined prices to enter or exit a trade. This helps to minimize the effects of emotional decision making and filters out many would be fake outs that often lead to a stop out. Having preserved that capital allows us to continue to participate in the next quality setup. Evaluating and managing risk should not be confused with evaluating a market.
BITSTAMP:BTCUSDLong
by MarcPMarkets
9
Bitcoin Bears Where Are You? Price Lingering At Resistance?#Bitcoin has been lingering at the current resistance level for a few days now, meanwhile markets that are weak do not linger, they sell off FAST. So what does this price action imply? In this brief video I explain what we expect from Bitcoin over the next week based on the clues offered by the current balance of order flow. We operate a LONG only swing trade strategy and have been in a position since the buy signal in the mid 5700s. 1. Since Friday there have been signs of bearish activity in the form of a bearish pin bar, followed by some inside bars. This configuration, relative to its location is setting up for a sell signal BUT it needs to confirm and that requires a close below 6425. 2. IF a sell signal asserts itself, that does not mean we react. The price structure that has developed since the 3800 low has maintained it's bullish integrity which for us means we hold our swing trade long and let the market play out. Often taking no action is the best action because in this game human nature tends to only get in the way. We have a stop in place, and we usually leave it up to the market to decide the outcome of our trade idea. 3. IF the sell signal confirms, what kind of retrace is within reason? The key resistance in play at the moment is the 7300 to 8K area, which favors selling activity. The fact that price is lingering nearby rather than selling off is conflicting to say the least, and can only be interpreted as a sign of hidden strength. IF the selling activity returns, we are still looking at the 5700 and 4800 supports as higher probability locations for bullish reversals. Also relative to the current bullish structure (3800 to 7200), pushing to a new swing low (below 3800) is a low probability scenario. Effective timing comes with the acceptance that ALL financial markets contain a HIGH degree of randomness. Logic will NOT give you any control or advantage in such an environment. All the news, opinions and analysis in the world will not help you if you cannot filter that information into a coherent and repetitive decision making process that accounts for the forces natural to any market. It begins with price action and order flow.
BITSTAMP:BTCUSD
by MarcPMarkets
13
Bitcoin: Bear Party? Don't Ignore These Support Levels.#Bitcoin has established a new lower higher off the 7K resistance area, BUT is this a signal for bears to run rampant? In this video I explain why the following support levels should not be ignored since there is a greater probability of a higher low developing. This can be particularly insightful for those who are not sure whether staying in a long position makes sense. We use patterns of order flow to gauge probabilities and then apply what we learn within the boundaries of our LONG only swing trade strategy. We rely purely on TECHNICAL analysis, not biased news or irrelevant opinions. Keep in mind, you do not have to agree with this evaluation, I just hope to provide a road map of potential inflection points. How Bitcoin reacts at these points will be determined by the price action unfolding at that time. 1. The fact that the key resistance at 6425 was compromised is a structural change that is NOT obvious, particularly to those who focus on small time frames. For our strategy, it means that the bearish weight presented by the recent sell off (10400 to 3800) is less. This increases that chance that the next bearish retrace is followed by a higher low or failed low, rather than a lower low. 2. The first inflection point is the 5800 level support. This is the .382 retrace relative to the recent bullish swing. This does NOT mean price WILL reverse precisely here, but it is an area where we can ANTICIPATE a change in order flow. IF Bitcoin presents the change, and provides a continuation pattern to go long, we will be prompted to share a new swing trade long idea. 3. The second inflection point is the 5K AREA. This support zone is relative to the recent bullish swing as well, which is smaller in magnitude. The key here is how price behaves IF it probes this low. If the lower boundary is cleared with little effort, THEN a lower low becomes likely. Otherwise, based on the price action at the MOMENT, it makes sense to anticipate a bullish reversal pattern in this area which will again, prompt us to share a swing trade long idea. Timing markets is NOT about predicting, it is about anticipating and ADJUSTING. Charts can help to a point, but unless you are an insider, there is a high degree of randomness that we must always consider. In reality, the lines on a chart do not mean anything unless you ACCEPT and UNDERSTAND a key concept about how markets work: logic does NOT drive prices. This means in order to win, you must evaluate market information from a behavioral perspective.
BITSTAMP:BTCUSD
by MarcPMarkets
13