Get started

Bullishmomentum

ETHUSD Perspective And Levels: Long? Or Wrong?ETHUSD Update: Bullish momentum takes price back up to 315 high while BTC touches 4500. Is this the time to finally give in and buy? NO. When a market looks obvious from a conventional stand point, that is usually time to sell or avoid. Let me explain. I have been writing about bearish signs appearing in BTC and in this market for weeks now. Minor retracements have been met with persistent buying all while in a resistance zone (BTC) or just under one (ETH). I realize there are fundamental events that are highly anticipated and will be taking effect in the next couple of weeks and perhaps this buying is related to that. The bearish signals that I have been writing about (pin bars, double tops) have not triggered in any of the markets, which on the short term can be interpreted as an absence of selling. So if these markets are negating the bearish arguments, why not start buying so that further gains will not be missed? Risk, that's why. Although the bear triggers have not been compromised, these markets still have not pushed through the appropriate highs in order to signal strength of a larger magnitude. 4548 is the number for BTC which clears the .618 resistance zone, and 350 for ETH in order to clear it's .618 resistance zone. These zones warn of a broad lower high which is not obvious to the crowd because everyone is focused on the small time frame price action, and the excitement and euphoria that is all over the media outlets. I do not have any fear of missing out because I know that markets retrace, and my rules guide me NOT to buy highs. And we are at a high (a lower high which is the absolute highest risk area to take on new longs, especially for a swing trade). This is a great environment for day trading because minor supports are holding, like the 280 area, and price is moving decently relative to the risks associated with that type of strategy, but I am not day trading and more concerned about managing risk than "missing the boat". At the moment, 303 is the .382 support for this movement, and 296 to 291 is next minor .618 zone which can serve as a good place to look for day trades. If price falls back into the 280s or below, I will be looking for the bearish scenario that I have been writing about. If price pushes above 315, then it is likely to test the 320 to 350 zone, which again can present day trade opportunities in which I will just be an observer of. No swing trade longs for me. What concerns me the most about this stubborn price action is this: Bloomberg is increasing coverage of these markets, even a former colleague of mine is appearing on Nasdaq's internet news channel and talking about these markets as an authority, meanwhile he sells stock option trading software. From a contrarian perspective, this is equivalent to the shoe shine boy talking about a stock, 100 years ago. They would say when the man on the street was talking about a stock, it was time to sell. It is another way of saying that the majority of the crowd is long, and soon there will be no one left to buy. Back during the Dot.com era, at the height, everywhere you went, every restaurant and party, and even TV shows were referring to stocks. This persisted for about a year before the market peaked. The details may be different, but the idea is the same. In summary, the short term price action appears to be bullish but hasn't met my criteria for me to justify taking risks on swing trades. If you have the time and patience, minor support levels are offering quick profits if you are disciplined enough to taken them. There is nothing technical about observing general signs of crowd sentiment, but my experience tells me these signs cannot be ignored, even in the face of minor bullish price action. If this market is going to work its way back up to 400 or above, the signs will be much clearer and risks will make much more sense after the resistances are cleared. This is a process, not an event. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
42
ETHUSD Perspective And Levels: Selling Structure But No Selling.ETHUSD Update: Lower high in place at 301 to 307 area which has occurred after the break of the 291 support (.382 of bullish swing). This is another bearish sign that shows this market is more likely to sell off, rather than go to new highs. I have been writing about this market and BTC for days now. The wave counts have been pointing to further weakness even in the face of what appears to be persistent strength. The confirmation that bears are in control will be established IF the 280 level gets taken out (this will be a bearish breakout and lower low compared to the previous low). The smaller time frames have been showing strength and traders who do not know how to incorporate the bigger picture cannot see the limitations of this bullish price action. BTC is still stuck within its resistance zone, while this market, if it manages to push higher, still has to have enough buying to get through the 320 to 352 zone in order to prove it has enough strength to continue to even higher prices. IF it pushes the zone, that does not constitute a buy signal. It would have to establish new supports and reversal structures in order for MY plan to qualify a long. The failure off of 312 and subsequent lower high which is now 307 can be the beginning of the selling structure that can turn into the bearish Wave C that I have been writing about for days. The conditions are present to facilitate a selloff, all that is required now is a spark, like some piece of negative news. (If the market sells hard, people will think the news caused it, but the market is vulnerable now. Just needs a reason to push it.) Again I have been using information to stay flat. If some very positive news comes out instead, that can erase the factors that are pointing to serious selling. News is a random element that must get priced into the market. What less experienced traders do not realize is this: news, as much as you like to think has a rational effect on prices, is NOT rational. It's interpretation is dependent on the sentiment of the market crowd, not our individual logic and irrelevant opinions. This is why there are times when news may come out that is good, but "not good enough" or bad, "but not that bad" in the eyes of the crowd. This is why I will let the market crowd figure it out, and once an imbalance is reached (more sellers than buyers or vice versa) then the price action will show clarity allow for decision making to be much easier. In summary, the lower high that is in place at 307 is just another sign that adds to the growing bearish argument in this market. A break below the 280 level, especially accompanied by a catalyst, will confirm bearish momentum which reduces the probabilities that supports will hold if the market retests them. I am just reporting the clues that the market is offering at the moment and they can be erased if some very positive information enters this market. My concern is risk, not being right or wrong and based on the current price action and structure, it appears risk for a long swing trade is very high relative to the potential reward. So I continue to stay flat and wait until the market offers better opportunities. Patience preserves capital, took me years and a ton of money to learn that lesson. Questions and comments welcome.
BITFINEX:ETHUSD
by MarcPMarkets
30
BTCUSD Perspective And Levels: Bullish Yet?BTCUSD Update: I have been explaining my bearish reasoning while the price continues higher. Is it still bearish? Yes and I will use this chart to help explain why. As I wrote in my previous BTC report, price is in the middle of a major resistance zone which is the 4203 to 4548 area (.618 of recent bearish swing). It is a very wide zone which means short term price action can work its way into the zone and appear to be bullish on smaller time frames. This type of price action is great for day trading because it is possible to take quick profits out of these fluctuations. I am not day trading though and looking to position myself for broader moves. Again if you want action, focus on day trades. Within this resistance zone, there are even more specific levels to watch. The 4334 resistance in particular is one that is related to significant selling (look back at chart history). Price is hesitating here at the moment, which is NOT a short signal, but a possible starting point (especially to watch). The other clue that keeps me bearish and prevents me from taking any new swing trade long positions is the wave count. My previous report shows the possible peak of the B Wave, and when the third leg of that wave (bullish Wave C) is evaluated, it is clearly showing a 5 wave structure which fits within guidelines of an ABC correction. A Waves and C Waves are typically motive. And once 5 waves are complete, the market is poised for the next wave to begin, which in this case is the bearish C Wave that I have been writing about. Consider the clues: Price fluctuating within a major resistance zone, Wave C of a corrective B (lower high), and a price level 4334 that has proven to be a resistance before. All you need now is a reason. I mentioned this requirement for a catalyst before and one trader rattled off a whole list ranging from China, to ICO scams, etc. When I say we need a new catalyst, we need one that IS NOT PRICED IN yet. It has to be a new piece of information for the market. It could be anything that can spark the initial wave of selling. Just like the previous sell off was actually happening days before the China news reached the market. I am NOT shorting these markets, but if I were, I would wait for a selling confirmation. Usually this happens once that catalyst is in play. The first thing I would look for is a break of 4032 (new .382 of bullish swing). Once that happens I will then look for a subsequent failed high. Another consideration for investors (besides going back to fiat), is to buy more cheap coins while your BTC can afford to buy more. This has NOTHING to do with swing trading, but something that I would consider because buying alt coins with BTC is an alternative way to be short BTC (I wrote about this a few weeks back). This assumes you have a long term investment plan for your portfolio of alt coins. What if BTC keeps going higher? Anything is possible. A bullish catalyst can surprise the market and negate the bearish signs that are present. Like I explained in my previous report, TA is about evaluating clues and preparing for possibilities. As price action traders we must always be flexible and open to new information. If this market continues to push higher, I need to see the 4548 level get taken out before I start evaluating support levels for new longs. In summary, the best we can do is define possibilities based on information the market provides (through price action) and prepare from there. At the moment, this market is still in a position that is poised to sell off, it is just a matter of a motivational spark. The initial selling may not even be that dramatic, and then the catalyst surprises the market. If I am wrong, and the market continues higher, I don't lose anything because I am not risking anything. Instead I adjust, and if this market is going to have a significant rally, it will offer plenty of swing trade opportunities. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
28