Only 8 times since week of 11 Nov 2013. What happened next?Only 8 times since week of 11 Nov 2013 weekly Stoch CL >90 2 WKS in a row. What happened next? NOT ADVICE. DYOR.
Btc!
Head and Shoulders - "Learn More Earn More" with usInverted Head and Shoulders Definition:
A head and shoulders pattern is also a trend reversal formation.
It is formed by a Valley (left shoulder), followed by a Lower Valley (head), and then another Higher Valley (right shoulder).
A “ Neckline ” is drawn by connecting the highest points of the two Peaks. Neckline resistance does not need to be strictly horizontal.
. This illustrates that the downward trend is coming to an end .
. When a Head and Shoulders formation is seen in an downtrend, it signifies a major reversal .
. The pattern is confirmed once the price breaches the neckline resistance .
In this example, we can easily see the head and shoulders pattern.
How to Trade the Head and Shoulders Pattern:
ENTRY:
we put an entry order below the neckline.
TARGET:
We can also calculate a target by measuring the high point of the head to the neckline.
This distance is approximately how far the price will move after it breaks the neckline.
❤️ If you find this helpful and want more FREE forecasts in TradingView
. . . . . Please show your support back,
. . . . . . . . Hit the 👍 LIKE button,
. . . . . . . . . . . Drop some feedback below in the comment!
❤️ Your Support is very much 🙏 appreciated! ❤️
💎 Want us to help you become a better Forex trader ?
Now, It's your turn !
Be sure to leave a comment let us know how do you see this opportunity and forecast.
Trade well, ❤️
ForecastCity English Support Team ❤️
Head and Shoulders - "Learn More Earn More" with usInverted Head and Shoulders Definition:
A head and shoulders pattern is also a trend reversal formation.
It is formed by a Valley (left shoulder), followed by a Lower Valley (head), and then another Higher Valley (right shoulder).
A “ Neckline ” is drawn by connecting the highest points of the two Peaks. Neckline resistance does not need to be strictly horizontal.
. This illustrates that the downward trend is coming to an end .
. When a Head and Shoulders formation is seen in an downtrend, it signifies a major reversal .
. The pattern is confirmed once the price breaches the neckline resistance .
In this example, we can easily see the head and shoulders pattern.
How to Trade the Head and Shoulders Pattern:
ENTRY:
we put an entry order below the neckline.
TARGET:
We can also calculate a target by measuring the high point of the head to the neckline.
This distance is approximately how far the price will move after it breaks the neckline.
❤️ If you find this helpful and want more FREE forecasts in TradingView
. . . . . Please show your support back,
. . . . . . . . Hit the 👍 LIKE button,
. . . . . . . . . . . Drop some feedback below in the comment!
❤️ Your Support is very much 🙏 appreciated! ❤️
💎 Want us to help you become a better Forex trader ?
Now, It's your turn !
Be sure to leave a comment let us know how do you see this opportunity and forecast.
Trade well, ❤️
ForecastCity English Support Team ❤️
Why You Should Never 'HODL' Your Positions Up To A Certain PointHello Traders.
Here I give a friendly reminder to all beginners and advanced traders that holding (hodl'ing) your position is not ideal up to a certain point. The math of percentages shows that as losses get larger (compound interest), the return necessary to recover to break-even increases at a much faster rate. A loss of 10 percent necessitates an 11 percent gain to recover - and that is where it goes all downhill. Increase that loss to 20 percent and it takes a 25 percent gain to get back to break-even. A 50 percent loss requires a 100 percent gain to recover and an 80 percent loss necessitates 400 percent in gains to get back to where the investment value started.
Investors who get hit by a bear market need to be aware that it will take a while to recover, but the math of compounding returns will help the cause. Consider a bear market with a 30 percent drop in value, down to 70 percent of what the stock portfolio was worth. A 10 percent gain returns the portfolio to 77 percent. The next 10 percent recovers to 84.7 percent. Two more 10 percent gain years put the portfolio back to 102.5 percent of the value before the drop. So a 30 percent drop necessitates a 42 percent recovery, but 10 percent a year compounded for four years puts the account back into profitable territory. I will be doing a second part to this post on the idea of "DOLLAR COST AVERAGING" (DCA).
What the math of stock market losses shows best is that investors need to protect themselves against big losses as shown in the diagram above. Mental or limit based stop-loss orders to sell stocks or cryptocurrencies are there for a reason. When a certain loss level is reached, it will pay off big if the market is moving into bear market territory. Investors sometimes have trouble selling stock they like at a loss, but they will like the stock or cryptocurrency if it can be bought back at a lower price.
If you are interested in how to create the perfect trading plan, please see my previous post here:
Trade Safe.
X Force
Bitcoin's Two Year Forecast - "When Should I Buy Bitcoin?"As Biden suggested, "It is a time for healing." - I believe it is absolutely true for a time of healing in all aspects of the world, including Bitcoin.
What is the Stock to flow? (about this indicator)
As suggested by the creator of this indicator, 'PlanB' :
" SF = stock / flow . Stock is the size of the existing stockpiles or reserve. Flow is the yearly production."
In simple terms:
Stock = How many Bitcoins are currently in circulation
Flow = How many Bitcoins are created each year
----------
Here I would like to explain the observations based on my own - these are the FIVE main phases of price action:
1. Price Halving Event
2. Price Discovery Phase
3. Price Continuity
4. Price Explosion / Blowoff Top
5. Price Maturity
Without getting too much into the mathematical details and formulas on how this indicator was created, this is a perfect indicator, in my opinion, to show the overall observation of where Bitcoin stands from a visualized perspective, where it shows that Bitcoin can withstand anything in any certain period of time. The first and foremost, Bitcoin has not only have we survived the harshest conditions of the market for 2020 (and 2018 alike), Bitcoin's fundamentals are getting incredibly stronger by the day; furthermore, Bitcoin is now collectively seen as a form of investment tool and regarded by many as one of the best returning assets of the decade. I believe the next decade is yet to offer more when the fundamentals of Bitcoin is much clearer and clears up the issue of scalability and overall issues with price maturity.
The most important aspect of this chart is to find where you can start investing Bitcoin . This answers the million dollar question of, "When can I buy Bitcoin?" The answer is NOW, according to this indicator. Why and based on what evidence? First, history is not indicative of the present price action, however, it does certainly rhyme with it. We can note that with each consecutive rise, it was usually after the halving events of Bitcoin . As we are now approaching into 2021, we are now putting our first step into the uncharted territory of new price discovery .
Despite the heightened level of volatility in the market, I believe it's important to emphasize that long term investors are unlikely to be fazed by the recent drop - especially after the 2020 events. The current short-term holder activity is reminiscent of previous bull trends, and if we are able to survive 2020, how can we not survive 2021-2022. As such, if BTC recovers strongly from the recent drop, the chances of a rally continuation could increase.
What will you do?
We hope that you are able to be disciplined this time and learn from the past mistakes of every year, and it is increasingly showing that we are well on our way to new uncharted territories of ATH .
Race is on between bitcoin and NI225 to reach ATH firstNOT ADVICE. DYOR.
Look at that Move
China too
Learning to trade the Head And Shoulders Pattern with Bitcoin.The Head & Shoulders Pattern & Inverse Head & Shoulders Patterns are quite common on Bitcoin and have had great results on the higher timeframe charts.
Here are the main characteristics:
• VOLUME MIMICS PATTERN
• 3 PEAKS, LEFT & RIGHT SIMILAR HEIGHT
• TRIANGULAR IN APPEARANCE
• FOUND AFTER UPTREND
• HIGH SUCCESS RATE
• CAN BE SLANTED
Price forms 3 distinct peaks after a strong uptrend, the left and right peak should have a similar height (shoulders), the middle peak (head) has to be the highest or this can not be a HS pattern. They should seem triangular in appearance but as long as it fits the main characteristics can still be a valid pattern.
The right shoulder should form a lower high which is a early sign of trend change, this is entry A, with entry B being the bearish retest of of the “neckline” (marked on chart #2). The idea is to gain an early entry on the pattern at point A to maximise profits and reduce risk. Once price moves above the middle "peak" it is likely that the pattern is not valid anymore so this allows us to get a tight stop loss upon entry. We measure the height of the pattern and add it to the breakout level for a maximum possible price target.
Volume should also paint the same pattern with the 3 peaks, strong volume on breakout increases success rate.
In this example on Bitcoin earlier this year it played out perfectly, hitting target, when having another great short opportunity on the Bearish Retest. A bearish retest is just a Support & Resistance flip off the pattern breakout level.
After the pattern played out we also saw one more great opportunity with General Pattern failure.
What is General Pattern Failure?
General Pattern Failure occurs when a chart pattern breaks out, fails to hit target, quickly reverses then rejects off that same breakout level back inside the pattern continuing in the opposite direction of the breakout.
Pictured above in the original post is a normal breakout on a Head And Shoulders Pattern while the lower example shows General Pattern Failure on the same pattern. Note how the first example has a Bearish Retest (B) while the second example is coming back inside that area and finding support for a potential long setup.
(The below chart is the above example continued)
General pattern failure can also be considered a Liquidity Grab or can be referred to as a “Fake Out” also when it happens more rapidly after the original pattern breakout.
Learning to trade patterns such as these can provide great opportunities if you understand price action and how to identify the key areas of the pattern that other traders and investors may be focusing on too, these areas become important psychological levels on the chart.
Market Cycles: How to Overcome the Fear of Missing Out (FOMO)In this post, I'll be providing an educational post on the cryptocurrency's market cycle, and how to overcome the fear of missing out, also known as fomo.
It's important to understand that the cryptocurrency market has very clear market cycles.
In order to profit in the cryptocurrency market, it's important to think like a whale .
1. To begin with, whales keep their assets in the form of fiat, or tether (USDT) before the beginning of a market cycle
2. Whales buy Bitcoin with their cash at hand, and this is when we see Bitcoin rally alone
3. Since Bitcoin is the only cryptocurrency to rally, Bitcoin dominance soars up along with Bitcoin's price
4. However, the market trend soon changes as the whales, who have profited from Bitcoin, move onto large cap altcoins
5. These are our typical altcoins at the top 20 in terms of market cap
6. After these coins rally, capital then flows into the undervalued coins with a much smaller market cap
7. Because there isn't enough liquidity, these less popular coins tend to break out the hardest, and demonstrate immense risk
8. After whales profit from small cap alts, it's time to convert their assets back to Bitcoin
9. This process is repeated during a bull run, and ultimately converted to fiat in a bear trend.
So, what are we currently seeing in the market today?
Bitcoin
- For Bitcoin, we are seeing a textbook bearish divergence
- In my previous analysis, I have provided consistent updates, in which the divergences I have spotted, both bullish and bearish, have played out perfectly.
- You can check the previous analysis above.
- As such, it's reasonable to expect this divergence on the longer time frame to play out as well
- The higher highs on the price, and lower highs on the Relative Strength Index (RSI) is extremely concerning
- The Moving Average Convergence Divergence (MACD) also demonstrates decreasing bullish histograms, with a potential death cross in play
Does that mean we have missed the train?
While Bitcoin may be done for the short term (since the uptrend is still intact, and we are seeing higher lows and higher highs on the longer time frames), but there are opportunities to be spotted in the cryptocurrency market.
Ethereum
- Ethereum has been consolidating for a while on the weekly, and has been inactive on the daily
- The Ethereum 2.0 Countdown just recently began, providing bullish stimulus for prices
- Based on the market cycle theory explained above, Bitcoin's short term bearish signals suggests an opportunity for Ethereum to break out
- Considering that Bitcoin dominance is trading within a downtrend over the long term, we could expect price action from Ethereum in the coming days
- For my analysis on ETH's long term price action, check my previous analysis below:
Conclusion
In summary, seeing everyone else make money while you sit on a pile of cash, might be frustrating mentally. But as I always emphasize, trading is a psychological game. Successful traders have a good understanding of the market psychology and cycles. As such, capitalizing on trading opportunities require a combination of proper knowledge and patience. There will always be opportunities, regardless of the market situation, as beauty is in the eye of the beholder.
And the wind blew, the earth split and it appeared ...The birth of BTC pumpkin. One dark dark evening, in a terrible 2017, when huge incomes of investors drove them to euphoric blood-strokes, it was born... Vegetable electronic evil , the king of margin calls, garden crypto ganster - BTC pumpkin.
With the right hand, it weakens the growing trend , and with the left hand it attracts with overbought stochastics, bear patterns and low volumes of bold sellers in the position ...and vice versa...
And no one knows peace from it for 3 years!
BTC Pumpkin's worst weapon is its mood. The bipolar disorder of this vitamin monster changes the mood every six months .
Will we see a new wave of BTC Pumpkin bad mood?
What is more terrifying, grater, blender or saw?
Today is the day when the crypto pumpkin knocks on the deposit house of every investor and says "treat or margin call?"
We hope you love sweets!
Can the BTC market free itself from the Pumpkin shackles? It remains to wait only six months...
P.S. Drug use is bad for your health and hampers your trading.
How to Create the Perfect Trading PlanHello traders! Here I would like to present to you another personal market psychology trading plan that I believe is effective for all traders ranging from beginners to advanced . Do you have a trading plan? Most don't. It's very important to create a set of fixed rules that you will always follow when you are trading! The key word here is trading - not investing. Investing has a completely different set of rules when finding the right entry and profitability of your account; however, here I will be showing you the sole principles of my own trading strategy that I believe has worked for me over the past years of trading. If you follow these steps correctly, I believe you will have the golden ticket to a much more profitable future, and if applied correctly, you will be having more winning trades than losing.
The 7 crucial steps:
1. Understand what timeframe you want to use
2. Risk management is key - don't over leverage, use a certain percentage
3. Market trend - make sure to follow the trend, don't be trade against it
4. Types of markets - do you trade mostly stocks? Bitcoin? Forex? These are all good for technical analysis
5. Entries - make sure that you have the correct entry. Don't rush into the market
6. Stop losses are crucial - especially when you are away from the charts
7. Targets - do you know where you want to exit?
Trade Safe!
X Force
Learning the BARR Top Pattern : Chainlink; is the run over?IF Chainlink does not claim 13$ again soon we may be putting in a bearish retest of a BARR TOP (Bump & Run TOP) Pattern.
The pattern is explained below and there are some obvious key area to watch on the LINK/USDT Chart.
Note the below image of Bitcoins run to 20000 as a comparison of a successful BARR TOP.
The Bump And Run Reversal Top (BARR Top):
• Follows strong bull market at steep angle
• Initial “bump”, followed by a hook shaped movement reversal
• Sell on the retest key diagonal trendline or buy if the pattern fails and reclaims the trendline
• GOOD SUCCESS RATE
Price has a strong uptrend off in two phases - the bump & the run, first a small increase then recovery occurs, then price increases with massive volume at a very sharp angle. The BARR Signifies a trend change from strong Bull to strong Bear market.
Price then makes a sharp peak and comes down breaking the support line the angle of this support line is usually around a 35-50 degree angle. It then throws back and bearish retests off that previous support (this is the entry point), its common for this rejection to be at the 0.618 fibonacci level.
Link has already made its sharp peak and has rejected right off the diagnol BARR trendline.
Log scale is to be used when identfying pattern. The possible price target is the start of the pattern, BARR Tops usually have strong breakouts but do not always hit price target.
Note how in the chart of LINK USDT we are rejecting right off the 0.618 fibonacci level, until price gets back above that LINK may continue to decrease in value.
If you enjoyed the idea show your appreciation by giving it a like!!
I look foward to hearing your comments.
Waiting to Enter on a Channel BreakHello my friend | Welcome Back.
Please support this idea with LIKE if you find it useful.
***
* Once I have this structure in place, finding the trend becomes relatively easy. When the pair is trending lower, I only want to look for selling opportunities. Of course, the opposite is true when the pair begins trending higher.
Enter in the Direction of the Trend
At this point, you have identified the major trend and found a favorable corrective pattern such as a channel or a wedge.
The next step is to look for an entry once price breaks the pattern.
BTC: Understanding Healthy vs Unhealthy Bull RunsHello traders and investors, here I would like to compare and contrast the stark differences between a healthy and unhealthy bull run. I would like to dissect the 2019 bull run vs the 2020 bull run, as there is one major difference that I would like to focus on in terms of the differences of the two bull runs.
The first thing that we can witness from 2019 is that we saw an incredible 300%+ bull run. This is no doubt an incredible feat for Bitcoin during that time, but it was merely impossible to know when to enter the market with no confirmation in sight. We have seen a series of higher highs being printed, with no real pullback until the end of the blowoff top where most have entered. After the real pullback, most were probably entering the market thinking it was going to go higher, which wasn't the case as we were seeing a series of bearish confirmations and sell signals from our lagging indicators and a bearish descending triangle.
The second thing that we can witness from the current 2020 bull run is that it is much more extended and simply a matured bull run, especially taking into account of direct stock market correlations and the on-and-off decoupling of different assets. This year has brought interesting and new concepts of how the bull market is running, especially with the series of uneventful news such as the unfortunate COVID19 pandemic (my prayers are out for everyone to be safe!) and now the election cycle in place.
In my opinion, this is actually one of the most healthiest bull runs we have had with all things considered. The fact that Bitcoin has responded to all negative news and events from 2020, the fundamental news of Bitcoin and the store of value idea is being shown within the price action. We are also technically seeing a higher low with each consecutive pullback, which is absolutely fantastic from a bullish perspective. Now the underlying question remains, "when should I enter the market?" Based on confirmations, we can enter safely when Bitcoin consolidates when we create a new 'higher low', possibly in the upper $9,000 to $12,000 range for the longer perspective. Remember, Bitcoin can still have impulse waves in between, but the overall point is making sure you are riding the 'waves' of the market, not the impulse waves.
Trade Safe.
X Force
Trading Hierarchy: What Really Matters in TradingHello traders, these past few weeks have been incredibly profitable for many traders (and many losses as well)! Here I would like to show you an investor philosophy that I always trade by when approaching the market. Many people approach technical analysis thinking it's the first and foremost thing they must learn, which in reality, should be the last. It's crucial to first understand that trading psychology and risk management is the MOST important factor when trading within the market. Even if you have strong technical analysis (which can never be perfect), you can lose if you have BAD risk management. You can lose even more if you are no patient enough and trade EMOTIONALLY.
The sad reality is, many professionals who have traded for years, still have yet to realize this. I hope this small educational post shines light onto advanced and beginner traders. Everyday, I am witnessing traders who are making money not knowing why, or losing money not knowing why. One thing that I always like to advocate is that it's better to know why you lost a trade, rather than not knowing why you made money in a good trade. These are realistic expectations of the market, there is no simple magic pill in technical analysis .
Trade Safe.
X Force
Only 5 Set-ups like this mon-shot since 2012 - How to trade ?All Charts To Same Scale For Comparison.
See Can Spot A better Way To Trade It
NOT ADVICE. DYOR
Bitcoin Suuport In or Not Yet ?Bitcoin - Support In or Not Yet ?
DXY - Retrace Over or Not Yet ?
Will USDCNY Crash By End By End Oct ?
NOT ADVICE. DYOR.
How to trade GOLD/SILVER RATIO in Any platform!?This is the first educational post I Make on Tradingview so make sure you like and comment and follow if you like it,
in this post I will explain how to trade The GOLD/SILVER RATIO in any platform
You can use the same strategy to trade ETH/BTC in Binance Futures with leverage ...
first lets define what is gold silver ratio ,
The gold/silver ratio (GSR) is the current price of an ounce of gold divided by the current price of an ounce of silver. It's a simple numerical calculation that shows how many multiples gold is trading relative to the price of silver, a common indicator used by precious metals investors worldwide.
this indicator help us know which is going to gain more or wich is going to lose more in some cases when there is high volatility in the markets you might find this chart stable with very strong trading opportunity for example back in the 26/2/2020 when the markets were uncertain and volatile this chart made a very good breakout and huge gains! you can find that on the chart above
so now lets explain how to trade it in any platform that have GOLD/USD and SILVER/USD
if you want to short the GSR
all what you need to do is to sell short GOLD and buy long SILVER with the same amount of money and leverage in each of the positions
Example
if you open a long position with 1000$ and x3 in SILVER/USD you have to open a short position in GOLD/USD at the same moment with 1000$ and x3 leverage.
If you want to long the GSR
all you need to do is the opposite of shorting we buy GOLD/USD and sell SILVER/USD with same rules again we should use the same amount of money and us the same leverage in each of the two position.
thanks for reading good luck
2020: Why Bitcoin Is Inversely Correlated With the US DollarThere is no doubt that Bitcoin and the overall crypto market has some correlation with the stock market, with market experts remarking that Bitcoin has been surging in tandem with traditional markets for awhile over the past year or so. Extensive research has already been conducted by market experts to study the seeming correlation of both markets, but I would like to take my stab at it as well, but from the US Dollar correlation perspective. Investors should be aware of the close inverse correlation between the strength of the US dollar and Bitcoin.
A widespread debate among investors is the correlation of Bitcoin (BTC) with other markets. In other periods, gold and Bitcoin appear to be moving in tandem. However, the correlation that needs to be monitored most closely is that of the dollar, as the global economy is based on the strength or weakness of our global reserve currency, the US dollar.
Bitcoin and Cryptos as assets:
The US dollar is the de facto world currency, thus the value benchmark for everything else, including assets and other fiat currencies. A lot of financial activities are based on US dollars like loans and settlements, which no doubt increase requirements and adoptions of US dollars (In a negative word, US dollar colonization). When the world lacks a supply of US dollars, everything else will fall in price in reference to US dollars. If the US dollar is stable, then the crypto prices may have become influenced by the monetary policies of other currencies. For example, there is very high inflation in Argentina, so the general public would like to exchange their Argentine pesos for Bitcoin, to reduce the risk of inflations.
Although Bitcoin and other cryptocurrencies can function like currencies, like payment and store of value, the market cap of cryptocurrencies is quite small compared to traditional finance, and most financial activities are based on fiat money. After all, you can't borrow Euro, then pay back Ethers. Typically you need to pay back Euro. In other words, the financial inclusion of cryptocurrencies is not enough. If bitcoin and other cryptocurrencies replace more traditional financial functions, which may reduce the role of the US dollar and other fiat money, the relationships between Bitcoin and other fiat money will be different.
For most of Bitcoins’s young life, the correlation between the cryptocurrency and the S&P 500 was largely negative—until the 2017 bull run (when Bitcoin’s skyrocketing notoriety seemingly invited a host of new investors, many of whom had their hands in other markets).
What I believe:
I believe that since the US dollar is now standing at the frontlines of support, and testing it twice, we can see some form of recovery within the US dollar, especially with Trump miraculously being tested negative again, and now also going into elections - which makes people want to carry more cash while the stock market remains volatile. People will be looking for a hedge, whether it is gold or Bitcoin, we also can't take out the fact that cash is also king. In the chart above, we can clearly see the inverse correlation between Bitcoin and the US dollar. For example, the COVID19 crash led to the USD rise immensely high in preparation for a possible recession caused by this pandemic (stocks also plummeted). After a miraculous recovery, we saw the US Dollar bleed slowly and also saw a clear recovery in the stock market, bringing Bitcoin along with it up.
From a pure technical standpoint, we can see that Bitcoin has broken down our legacy trend line, and is now retesting the resistance twice, while the US dollar retests the support for a second time.
With all of these considered, we can assume that Bitcoin will have some form of correction, while markets remain volatile and cash driven investors will liquidate their investments in preparation for a hedge.
Trade Safe.
X Force
BTCUSD: Decision Time - What Will Autumn Bring $9K or $12k?What will the break of the symmetrical triangle bring: $12K, $9K or more $10K?
Bitcoin Hash Rate, Dominance, Energy, NVTS & Volume
Logirthmic Curve & Network Growth : $100K in 2021?
2020 BTC Timeline - In-Depth Fundamental & Technicals AnalysisAs a result of the Corona pandemic, the financial markets are experiencing a year of extremes. These include, as well as the speed of the price slump and the severity of the market fluctuations during the panic phase in March, the recovery rally that has lasted for two and a half months. Its extent is extremely impressive, and considered by many, terrifying. All of my explanations are clearly inputted in the chart above. Let's take a moment to dissect the current ups and downs of 2020:
Phase 1: Pre Corona Bullrun
Bitcoin was in the traditional bull market during the months prior and after 2020. There were no clear signs of retracement, including the indices and equities market.
Phase 2: Corona Crash
COVID 19 Pandemic, with a series of uneventful news. Global markets saw a crash, including Bitcoin's largest drop in it's history in a short timespan.
Phase 3 & 4: Recovery + Accumulation
1. Stimulus from the Fed and Congress
2. Expectations of a strong recovery
3. Dominance of Tech Stocks
4. Individual Investors outweigh the market
5. Momentum Trading
Phase 5 & 6: Uncertainty + Election Cycle & Post Cycle
Stock market makes a full blown new high, bringing Bitcoin to newer highs. All we can do is now assume and mix new educated guesses via technical analysis and current world fundamentals. Things to consider include the possible tech bubble, Trump testing positive for COVID-19, the election cycle. IT WILL BE A ROCKY RIDE.
Technicals:
1. Bitcoin has created a definitive top for the year 2020, and we still have yet to fill our CME gap near $9,700.
2. We are currently bouncing on the larger 236 fib level.
3. We are also trading in a tight region of the newly immediate fib level.
It is possible to revisit $11,000 levels, before re-visiting any lower levels. Current sentiment for Trump testing positive is NEUTRAL. The markets have reacted rather neutral. Bitcoin has dumped pre-market upon announcement, but has stuck to support.
Trade Safe!
X Force
If you like my content, please like my post for support! Thank you.
BTC: How Will Bitcoin React To Trump Testing Positive?After a few of the most uneventful news this week, Friday (Oct. 2) has brought a couple of interesting developments that are rather unexpected. Just a few hours ago, United States President Donald Trump announced on Twitter this morning that he and First Lady Melania Trump had tested positive for COVID-19, an unexpected movie plot twist that has sent shudders down into the global economy at the time of writing. Will Bitcoin become the safe haven for investors after such an incident? We are shunned by such an incident as well, but let's dive into some of my deeper thoughts on both sides of the spectrum, as we are seeing gold decouple from Bitcoin.
Overview / Current Aftermath / Technical Analysis:
At the time of writing, Bitcoin has fallen 2.5% as the news broke out dropping from $10,660 to $10,300, and is now stabilizing on the short term with a slight bullish divergence on the one hour time frame. From a technical standpoint, we can assume there needs to be some form of a recovery bounce; however, there was a larger fall when the BitMEX news broke a few hours before that, where Bitmex has been accused of preventing money laundering. There has been a minor recovery to the $10,450 levels at the time of writing which has put the asset back to weekly support near the 20MA. From a larger perspective, the 20MA has acted as a strong support for Bitcoin, but with more unexpected global crisis looming, we aren't sure of the outlook on Bitcoin. As Bitcoin has been a traditional safe haven investment, we have been witnessing Bitcoin slowly align with traditional equities markets, where we aren't seeing the true decoupling from the stock markets.
Looking at the larger picture and time frame, Bitcoin is still within its range-bound channel and this reaction by the news-selling bears has been just a blip. But what about the short term? We can expect some form of reaction most certainly during and after the hours of US trading hours, whether it will be up or down - we do not know for certain. Gold prices has spiked over a percent in a short time span following the news taking the precious yellow metal back over $1,900/oz again. Highlighting the investor flight from risk was a drop in Bitcoin, with Bitcoin down by more nearly 4% on the day, while Ethereum fell by 6-8%, respectively.
US futures on the S&P 500, Dow Jones and Nasdaq 100 traded around 1-1.5% lower, suggesting the major indices will fall at the start of trade later on today, while oil suffered the heaviest blow, sliding by more than 3%, as investors fled risk-linked assets. Even the US dollar came under strong pressure to the benefit of typical safe haven assets such as the Japanese yen, gold and US Treasuries - all of which are up at the time of writing, respectively.
Bullish Perspective:
Analysts who have been less critical of Bitcoin and other cryptocurrencies in the past seem to believe that BTC won’t be too drastically affected by today’s chaotic news cycle–after all, it hasn’t been (at least, not yet.) As stated by Joseph Young, a crypto market analyst from Forbes, has stated, "...BitMEX charge and Trump contracting COVID-19 couldn’t take Bitcoin far below the $10k level even briefly... The resilience of Bitcoin during this cycle is quite impressive.” Similarly, Marcel Burger, founder of crypto investment consultancy boutique Burger Crypto, wrote on Twitter that “Trump testing positive on COVID and the entire market tanks again. Bitcoin also dealing with bad news around Bitmex (founders arrested), but actually manages to control the damage. Pretty bullish to me.” The election cycle will continue to have a big effect on crypto prices, but how far? That is only determined by time and the equities market.
It’s true–BTC’s +/-5% immediate reaction to either (or indeed, both) of these events could almost be considered a non-reaction in the history of an asset that is known for its extreme volatility. Still, the real reaction to these two events–and to their related affairs–could still be on the horizon as we still haven't seen a real reaction by traditional markets such as the SNP500 during opening hours. For example, Trump’s COVID case will likely have a significant effect on the US Presidential election cycle, which, in turn, could have a big effect on the price of Bitcoin, instead. While even before Trump tested positive for COVID, the American election cycles were having an increasingly powerful effect on cryptocurrency prices; and it isn’t all sunshine and beautiful angels. Most people have always more or less re-invested back into Bitcoin, eventually, as we have witnessed in August, for example.
Bearish Perspective (Higher Probability):
While both the BitMEX indictment and Trump’s COVID case made it into the New York Times today, one of these just might be more significant than the other. Both have immediate and long term effects on Bitcoin, regardless of how Bullish Bitcoin may be. Indeed, while the BitMEX's case is more specific to the cryptocurrency world, Trump’s COVID contraction seems to be having a more powerful effect on crypto markets on the immediate term. The BitMEX news has caused a 3% fall in the price of Bitcoin. Prices rebounded before Trump’s COVID Tweet sent them back down again. Together, these two stories still acted as a negative effect for Bitcoin prices in the immediate follow up. If traditional financial markets are any indication of what’s coming for BTC and other cryptocurrencies (and, historically speaking, they have been - even more so currently during the COVID-19 pandemic), further price drops could be on the horizon - short term and long term. Markets outside of the cryptosphere are reacting to Trump’s COVID announcement similarly to the way that they reacted to the widespread lockdowns in March: for example, gold is continuing its rally to the upside, continuing the rebound that began ahead of Tuesday’s presidential debate due to the uncertainty and uneventful news that followed.
Stock markets, however, can be a completely different story. If our analysis on Bitcoin and the Stock Market's correlation continues to be true, we may see further downfall for Bitcoin. The BBC reported just a few moments ago that, “(the) stock market futures showed that all three of America’s main indexes – the Dow Jones, the S&P 500 and the Nasdaq – are set to drop by at least 1.5% each when trading begins on Friday...” A number of analysts, including the X Force Global, are predicting that BTC will go the way of the stock market, just as it did when the COVID financial crisis began in March of this year. These eventful news will only exaggerate the price drops.
Trade Safe.
X Force
Eyes on post election price actionThese 3 charts indicate that price is usually fairly stagnant pre election.
The historical data on these charts only go back to 2012 however the patterns are almost identical.
Chart number 1 rallies to an all time high in 392 days, and chart 2 rallies to another all time high in 399 days.
The blue vertical line is the date of election and the pink line shows us where price was at that time.
This tells me that historically post election and early into the following year a bull run occurs. The year of an election also correlates with the year of a halving which seems to deliver positive price action.
Could 2021 be the next big bull run?
BTC/USD Weekly Timeframe
