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BTCUSD Is The Top In Place?BTCUSD update: A move off the 17171 all time high to 13010 in two days. 5K move in two days is a demonstration of how much risk is involved when buying into this market at such levels. What is even more amazing is this retrace is within proportion of the current price action. In other words, this market is not bearish YET. The nearest relevant support measured from the 5400 low is 12751 which is the .382 of the recent bullish structure. The 5K pullback just missed that level by about 400 points and is now showing a long wick on the current candle. This kind of price action is perfect for day trading long and short for those who have access to reasonable spreads and can short. The futures market should provide that flexibility for the rest of us. Is this market finally going to sell off like everyone keeps saying? The answer is: it is too early to tell. The bearish price action that has appeared may seem dramatic, but it is within the proportion to the way this market is moving and has not even broken the first projected level of 13010. That is why I keep saying this market is for day traders because you take your profit based on targets on smaller time frames. There are two levels to watch for as the market unfolds. The 13010 for a double bottom reversal which can lead to a long signal, and the 15580 to 16273 area (.618 of recent bearish swing) which can lead to a lower high and signal a sell off that can retest the 13k level or lower. There is no question that the market is generally strong, and that means there is a greater chance that the support level holds while the resistance level breaks. I am not buying into this market at all. I prefer to wait for the futures to open tomorrow and next week and see how price action is affected before I take any position in this market. I am more interested in trading the futures than I am of the actual coin because of the flexibility. I am still a firm believer that the futures will bring balance to this market rather than dramatic new highs. As far as shorts go, the current leg is the first sign of weakness. Weakness means there are more sellers than buyers within the current price action and is not to be confused with a trend reversal which takes a lot more time to develop. This is why shorting is more effective on shorter time frame strategies like day trading which are characterized by tighter stops AND targets. The less time you are in this market as a short, the better. If you are looking for shorts, wait for a reversal at the projected resistance level, that is where the reward/risk is the most attractive. And again, if you do not have a well defined plan then you should not trade at all. A more serious correction can take this market back below the 8ks but there is NO structure in place that implies that YET. Remember TA offers clues in regard to what is likely to happen in the immediate future. The more time that is measured takes away from the reliability of the analysis because anything can happen. A piece of news can come out that takes the market by surprise which a chart cannot foresee. Often the market is in a position that news will push in a particular direction faster, so TA may not offer precision, but at least it provides a way to measure the risk and potential. In summary, it will be interesting to see how the behavior of this market changes along side of the upcoming futures markets. There are many opinions but no one knows for sure, not even the people who are responsible for creating the futures contracts for the exchanges. This first leg of selling is normal and is still within the recent bullish structure. If this market is going to correct further, it is more likely to begin that process from a lower high, a double top or a double top variation which can start from a slightly higher high. Emotions are running rampant in this market, do not let yours control you, even a simple plan is better than nothing at all. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
37
ETHUSD Higher Low And Long Entry.ETHUSD update: I am LONG from 420.27 with a STOP at 396.45 and TARGET at 453. Reward/risk: 1.4/1. The entry criteria has been met for a swing trade long. (Trade was posted as an update in my previous report). I will explain the thought process further. As I wrote in my previous summary, buying into a pullback within a broader bullish trend is in line with my swing trade plan, BUT there has to be some form of confirmation. That confirmation has appeared,and as a trader, I have done my part: followed my plan, now the rest is up to the market. As far as levels go, the 422 to 400 area is the .618 support zone of the recent bullish swing. That was the first point of interest, but not enough for an entry. I wrote about the 391 level and how I wanted to see a reversal formation between there and 361. 391 held and the higher low formation has appeared around the 400 level along with a newly established broader double bottom formation off of 391. A higher low on a smaller time frame off of a larger double bottom in a generally strong market is in line with my plan. Even if this trade stops out, I waited for everything to line up in my favor. Having these definitions and letting the market prove itself is better than buying too early and not knowing if this market is going to hold or collapse. At least I have structural evidence that suggests the bearish scenario is now much less likely. Why 453 target and not 500? (Or some other ridiculous number like 1k?) IF the market offers the opportunity to sell at 453 quickly. I will exit half the my position, and trail my stop manually from there. I try to lock in some profit and reduce risk as soon as soon as my plan calls for it. I chose 453 because it is just below the 455 old support/new resistance level and in the middle of a .618 resistance area of the recent bearish swing. Since this market is generally bullish, there is a better chance that price breaks above that zone and retests the 500 high, so I intend to hold some for that possibility. I don't know if my trade will work out, all I know is that the factors for the outcome that I am looking for are now in line. That is the purpose of a trading plan. I don't have to think, or worry, everything is defined ahead of time, from the entry, to the management to the exit. The hardest part is WAITING, as many people do not have the patience, especially when markets like BTC go to 17k in a matter of a couple of days. I suspected this market retraced because of the BTC spectacle but that is just a hunch. If this market has retraced because of congestion over some cat game on the blockchain then that is not really a good sign in my opinion. How is it going to handle serious applications where there is a lot more at stake? As a short term trader, I really don't care why, because I am not trading on that information. I used to trade stocks of companies that produced nothing. It is price momentum that I am interested in and that's it. In summary, I am simply following my plan and that is the best I can do. Now I just have to manage the trade as the market unfolds. Things change fast and that is why a well defined plan is so important because it enforces rules and minimizes emotions. Many new traders are soon going to learn the realities of trading. BTC is lala land, no skill is required to buy and hold. When that market returns to reality that is where the skilled traders will step in and capitalize on all the bad habits and euphoria that is running rampant in that market. A 5K move in 5 days without a retrace is a breeding ground for unrealistic expectations. Learn to structure your decision making process, and no matter what conditions you face, you will at least align yourself with the probabilities while at the same time knowing how to constantly adjust for risk. As much as people criticize TA, it at least provides the tools to build a framework for consistency. Comments and questions welcome.
BITFINEX:ETHUSDLong
by MarcPMarkets
35
BTCUSD Perspective And Levels: Signs Of Strength For Now.BTCUSD update: Price is pulling back in a very shallow consolidation which is now presenting a bull flag formation. This price action is not characteristic of a weak market or a bearish C Wave. If anything price is poised to retest 8k and possibly higher. Weak markets do not consolidate near highs, and do not unfold in bullish formations on larger time frames. This market is not weak, yet. I have been writing about the tricky B Wave, which typically unfolds in 3 legs. The current structure appears to be in a minor Wave 4 and setting up for a new high attempt. That is not characteristic of a B Wave which means the market has negated that scenario. It hasn't even compromised the 7350 minor trend support (.382 of recent bullish swing) and is no where near the 7k support that I was using as a reference to confirm a C Wave was in play. Weak markets reject levels and sell fast, and often originate from a failed high or double top and this market is not showing any of those structures at the moment. The fact that the 7350 and 7k supports are still intact is another bullish sign. Until those levels break, this market is a high risk, low probability short. (In other words a pure gamble). Based on this time frame, a break of 7800 will also signal buying and possibly the start of the next leg that can go as high as the mid 8ks. Projecting an extension from the 6300 low shows a 1.618 at 8381 which is just under the 8468 level which is the upper boundary of the fakeout zone that I wrote about in my previous report. (It is a projection measured from the 5400 low). This type of price action is ideal for day trading in my opinion because you don't have to take the large time frame risk, while capitalizing on generous moves. The reason why a swing trade is less attractive is because it is not worth the risk at these levels. I have to risk around 400+ points to possibly make 300 or slightly more? Day trading stops are more like 50 to 100 points while you can capture 150+. Makes much more sense. In summary, this market still continues to show signs of strength. A shallow retrace, bull flag, untested minor supports, all point to a better chance of higher prices. How much higher? Based on proportions mid 8500s is reasonable at this point. There are many different forces at play in a market like this and little to no regulation. There are pros and cons to every situation. The strength may not make sense in terms of logic, or this market may be propped up by the BTC community through their technical advantages, or maybe it is full of fake Tether as some have suggested. The reasons don't matter if you are a short term speculator. Price action is showing signs of strength, so embrace it or avoid it, no one is forcing you to participate. For my swing trade plan, the risk is unjustified so I will stay flat. If this market is going to sell off hard, it needs a surprise (like an exchange going out of business) because at the moment, there is very little price action to support a bearish argument. Comments and questions welcome.
BITFINEX:BTCUSD
by MarcPMarkets
43
EOS very bullish ahead, cup and handle formation on a day chartBITFINEX:EOSUSD The chart speaks for itself, we have two strong resistance ahead at $1.85 and $2 so watch for those. Once it crosses them the $2.20 is a very achievable target. It can take some time to get there but I would say by next week sometime we should be pretty close to the target. Personally I'm very bullish on EOS, we are still on an very much up trend, as long as it makes higher lows and soon higher highs, there is no reason to panic :). The market seem to be very strong. If you still want to get on board look for consolidation zones and get in there, the optimum buying point is gone.
BITFINEX:EOSUSDShort
by pgarret
ETHUSD Perspective And Levels: Strength Returning?ETHUSD update: Price structure is showing signs of continued strength with a higher low and breakout of a smaller range between the 275 and 310 area. It still has to get through a wide resistance zone that has been holding this market back for over a month. Based on the new bullish structure, 372 is a realistic short term target. I have not been writing about this market because it has been uneventful in terms of signals or opportunities defined by MY swing trade plan. The most recent price action now offers structure that suggests this market is setting up for a broader break out. In my previous report, I described the range between 275 and 310, but that was just a minor range within a very large weekly range. The large overhead resistance zone that has been established for over a month is the 320 to 355 area (.618 of bearish structure off the 395 high). Within that zone there is a minor resistance between the 323 and 338 levels (.618 of the recent bearish swing off of the 335 high) which price is gyrating within at the moment. Even though these resistance zones are in play, what makes this price action compelling is that fact that price is now coming from a base of strength. There is a higher low established at 286 level and a higher high at 339 which is the resistance zone high. (These zones have been on my charts weeks in advance, and they are still in play, special note for those who do not believe in the merit of TA). This higher low structure also allows for new support levels to be anticipated which are the 315 level (.382 of structure), 312 (old resistance/new support) and the 300 to 288 area which is relative to the .618 of the bullish structure. When you project price extensions from the higher low, the 372 target is the 1.618 extension which makes it the potential short term target if this market has enough momentum to break out beyond the 355 level. What is my plan? Previously I wrote about waiting for a retest of the 270 range support, but in light of the new bullish structure, I am now looking for a retest of the 315 level for a swing trade long. The 315 level offers slightly overlapping support and better reward/risk according to MY plan. So I will wait to see IF the market retests that level and look for some kind of bullish reversal, whether it is a smaller time frame chart pattern or larger time frame candle stick. In summary, this market has finally developed some price structure worth writing about. The higher low and minor range breakout are bullish signs that can be the beginning of a much larger breakout that can take price beyond the 355 level. Based on proportions, the first target at the 372 level would be a good place to lock in some profit and reduce risk if you are currently long. Remember anything is possible in these markets and if this price decides to retest the 280s again, I would be interested in buying there also. On the weekly chart, this market IS still range bound so make sure to keep expectations within that context. I do believe in the long term (months) the big picture consolidation will break out and this market will see much higher prices, but it is not in a hurry at the moment, and you shouldn't be either. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
11
BTCUSD Perspective And Levels: Jack Be Nimble. Very.BTCUSD update: It appears Wave B is in play with one more leg expected to retest the high 6ks to low 7ks before the C Wave unfolds taking this market significantly lower. Based on the structure at the moment, the current formation appears to be transitioning into the second leg of Wave B which often looks like a minor retrace of a zig zag formation. A higher low and push to the 6930 to 7330 resistance zone is what I am anticipating as the next move for this market. Like I have been writing about, this is a tricky formation. It does not have to go as high as 6930, it may fail sooner. Or it may go slightly above the 7330 and then fail. There is no way to predict that movement for sure, the best I can do is forecast that as one possibility out of many. The key to using this information is being prepared IF the market chooses this outcome. In terms of day trading, I think there is a good opportunity for longs with a relatively small stop (70 to 100 pts while aiming for a 150 to 200 point target). In terms of swing trades I am open and flexible to go long IF price can retest the 6050 level and show a reversal formation on a smaller time frame (1 hr or 30 min). That support area offers more attractive reward/risk in my opinion for longer time frame strategies (multi day is long for this market). A break below the 6k to 5800 area (.618 of the current bullish swing) will signal that prices are likely going to break the 5400 support and retest the high 4ks (especially if there is a lower high established around the current levels). I keep repeating this because I think it is easy to forget when prices are moving: you must be nimble. That means recognize change and adapt quickly. It is a day trading mindset which has no room for opinions. If you are slow to move, or stubborn, or don't have a clear trading plan with stops and targets predefined, then you really should not be trading this market at all. My plan is simple: Buy the failed low and attempt to capitalize on the retest of the 6900 area. I am flexible, I have no opinions and no ego. To me, it is not about being right, it is about recognizing when variables are lining up that are in line with my plan, and recognizing when they are not and adjusting to that information. It is hard to share this thought process in real time because the market makes its moves when it makes them, and I am not in front of a computer 24 hours a day to write about it. This is why I always say you must learn to think on your own and use analysis like this for context and perspective to help confirm and adjust your own independent interpretation. In summary, the current bullish retrace in this market is not poised to go back to 8k (at least not yet). B Waves often attract a lot of traders thinking they are buying a pullback, but in reality it is setting up for a much broader bearish wave (C Wave). That is the way the structure is unfolding at the moment and it can change. I have written about this situation before only for the market to consolidate and break out to new highs. What makes this situation different from those previous environments is there are 5 clear bullish waves complete which on this magnitude implies a much broader correction or consolidation at least. Don't get stuck on feelings and opinions in this market, it is too fast. TA is your best friend when you need speed, but you have to know it well. An RSI on a 15 minute chart is not going to help you unless you know how to interpret it within the context of the price action going on around it. Comments and questions welcome.
BITFINEX:BTCUSD
by MarcPMarkets
49
ETHUSD Perspective And Levels: Middle Of Range?ETHUSD Update: Price retraces back to 294 while BTC continues to push highs. The fact that this market could not push the 315 high is concerning and I do not plan to add to my long position. I am still long from 298.84 with my stop now adjusted to 286. At this point, in order f or me add to my position, price needs to show proof of strength. The 315 level is a tough range resistance and also a lower high formation which is not what I want to see when I am long. A break below 288 will confirm the 315 double top and a good level for me to be out of this trade. I think I gave it plenty of time to prove itself. The 297 to 294 minor support (.618 of recent bullish swing) is holding price up at the moment, and in a more bullish environment, this would be a good place to go long or add upon a reversal signal. Since price is coming from a double top, I suspect this support is more likely to break. Keep in mind this market is consolidating and during these conditions, price can do more random things as compared to when price is trending. By adjusting my stop higher, I am lowering my risk on my small position while still giving the market some room to reverse back in my favor. If I get completely stopped out at 286, I will not consider getting back in until this market starts moving big one way or the other. That means a bullish or bearish break of this consolidation will get my attention ONLY. From there I will reevaluate the potential for any swing trade longs. If the mid 280s is taken out, then the key level to watch is 270. If that breaks then the 250s become a strong possibility again (I wrote about this level in previous ETH reports). Keep in mind I only trade these markets from one side and that is the long side. I understand many of the newer traders who seek action and adventure get anxious when I do not have any trades to talk about. If you are looking for broader movements in markets where reward/risk is decent and you are not trading anything else, consider the forex markets. There is a ton of activity there. In summary, the price action in this market is not favorable for buying more at the current levels in my opinion (this may change if 310 is taken out). Not only is this market in a small range between the 273 low and the 310 area high, but it is right in the middle of a huge range (355 high and 136 low). In situations like this, swing trading is not the best strategy because of the overall lack of follow through like this market has been showing over and over. So it's either day trade, take small profits or position trade which is buy and hold small portions with very wide stops to avoid getting stopped out in the noise. In order for the market to be in play (meaning it is making progress in either direction and not gyrating) this range needs to be taken out. This is all about adjusting and being flexible. For those who are new to these markets, BTC was quiet for 2 years before it started making some real progress. I believe in the long term the break out will be to the upside, but until it starts showing more bullish signs, I am just going to sit tight and observe. Comments and question welcome.
BITFINEX:ETHUSD
by MarcPMarkets
24
ETHUSD Perspective And Levels: Higher Low Formation.ETHUSD Update: Consolidation breakout to 310 off of the higher low formed in the 280s. This is a bullish sign and implies further strength, with a reasonable target in the 320s. I have been long from 298.84 for a number of days, and actually got stopped out of half of my small position after making an adjustment (this is all explained in previous reports). So I am holding onto 15% of my regular position size. And the possibility of this scenario is the reason why I did not exit my entire trade when it was consolidating in the low 290s. On the next retrace and reversal confirmation, I will look to buy back in with the expectation of a target in the 320s or 330s. This is a tough market and is not one to get overly excited or aggressive about. @Goldbug1 had it right by buying for the long term which means he would not fall victim to the erratic gyrations that are more and more frequent (check out his other alt trades too, impressive). If you zoom out and look at this market on a daily or weekly time frame, you will see price is right in the middle of a huge consolidation that may very well be a giant Wave 2. Which puts the current price action into perspective. Any sudden price spikes, especially on low volume such as this one, are to be met with caution. With that being said, the current spike does establish a clear higher low (HL) in the low 290s area which is a bullish sign. Higher lows often lead to higher highs. So this is my justification for adding more to my current position on a retrace that meets 2 criteria: it forms above the 297 to 293 zone (minor .618 of recent bullish swing) AND I get a reversal formation such as a double bottom or pin bar on smaller time frames such as the 30 min to 1 hr respectively. The reason why I am not painting rockets (besides the fact that I usually don't) is because if you project a price extension off of the higher low, you will see the 1.0 level is just below 330, and the 1.618 is in the 350 area. On top of the resistance zones that are present, and the context of the giant consolidation, this market is not set up to do anything spectacular in the short term in my opinion. Sure a piece of news can spark a move, but if I am going to capitalize on short term fluctuations, I want to at least have a reasonable idea of what my profit potential is, and that is why TA is so helpful. Eventually, if this market breaks above the giant consolidation, it can go up big, which is no where near happening since we are in the middle of the range at the moment, not the highs. In summary, the current price spike does add more to the bullish argument and provides structure that not only implies further strength, but allows for a reasonable expectation of the 320s as a profit target. As long as the next retrace (if there is one) occurs above 297, I will look to add to my long as per my criteria being met. Don't lose sight of the overall context by taking some time to review larger time frames like the daily or weekly charts. Capitalizing on the constant flow of opportunities in these markets is more about managing risk, not jumping into every move. Profit is a by product of good risk management. Questions and comments welcome.
BITFINEX:ETHUSDLong
by MarcPMarkets
35
ETHUSD Perspective And Levels: Higher Low 290s?ETHUSD update: Price is fluctuating in between the .382 and .618 support areas that I wrote about in my previous report. I am long from 298.84 (as mentioned in my update) with my stop now adjusted to 279. I will explain. After reevaluating the price history along with 283 being within the .618 support zone, I thought it would be better in this case to adjust slightly lower to accommodate the support structure in the area. My risk does not increase by much and my rr ratio changes to approx. 1.5:1. I do not usually adjust a stop against a trade, but I make this rare exception because this is where the stop should be based on price structure. Since this market has retested the 297 level that I wrote about previously, it is consolidating (as evidenced by the 4 hour doji candles) and may need some more room for a possible fake out. This is when price goes lower, but without making a new low. In this case, as long as price holds above the 273 support, this market will be in the process of forming a higher low. Higher lows as we know are a sign of strength and often lead to higher highs. A decisive break below 273 which is the recent low, then this market will be more likely to retest the 250 support zone that I wrote about previously as well. IF price holds, especially above the 286 area, then there is a greater chance this market retests the 310 area in my opinion. I plan to add to my position if price can show additional strength which can unfold in a number of ways. One way is a push back above 300 along with a minor retrace followed by a bullish reversal on a smaller time frame such as the hourly. Another way would be the break above a bullish pin bar IF one appears after another retest of the 290 low. Either way there must be some new supportive structure to justify an add of 30%, otherwise I will just hold what I have. In summary, even though there has been a lot of noise resulting from the BTC fork, TA still provides reliable levels to work from. Often environments like this are perfect for day trading because you can capitalize on these fake outs rather than get stuck in them. Most importantly, you have to have a plan, or some kind of decision making process in place that is based on information generated by the market. Otherwise it is easy to get caught on the wrong side of extreme prices, especially in this market. Comments and questions welcome.
BITFINEX:ETHUSDLong
by MarcPMarkets
27
ETHUSD Perspective And Levels: Bottoming Formation Hourly.ETHUSD update: Failed low (double bottom) formation appears on 1 hour time frame which is a trigger for a swing trade long. I am in from 309.95 (50% position size) with a target of 335 and STOP of 294. Reward/risk is about 1.5/1 (this will change as I make adjustments based on new price action). I updated my previous post as soon as I took the position. The push off the 287.46 low is a typical momentum reversal sign which are tough to buy into initially because it happens fast and there is not a lot of structure to measure risk from. I mentioned in my previous report that I was watching the 290s and low 300s for a possible higher low in order to justify buying back in. 310 isn't the perfect price, but it still offers attractive reward/risk. The higher low that has formed in the 305 area can also serve as a reference point for risk. A reasonable stop would be 303. I chose to put my stop underl the .382 support at 294 to give it a little more room to fluctuate. (Since I am only at 50% position size, I can afford wider stops). I plan to put on the other 50% upon a break of 316.85 which is just above the recent swing high. While I am eyeing the conservative target of the 335 area, depending on how price action unfolds, I may hold onto part of the position to see how far it can run. A retest of the recent high is not unreasonable while a break can lead up into the 380s. This is the kind of price action I like to see after a retrace to a significant support (295). Even though price went about 10 points lower, in the context of the bigger picture, it is not that much lower which means the bullish trend that took price into the 350s is still intact. This also means momentum should favor bullish setups, especially when price structure forms on time frames such as a 1 hour or 4 hour. This is when factors are lined up and reward/risk makes sense. Keep in mind, price can fluctuate back toward the 305 area which would be perfectly normal, and I would still consider that supportive. Also it is not surprise that BTC bounced off of the 5234 level simultaneously which happens to be the .382 of it's entire bullish swing as well. In the bigger picture, the retrace in that market was normal and is not that far from pushing highs again. As long as that market stays supportive, I think that can only help add to the bullish momentum in this market. Certainly something to watch for. In summary, the healthy retrace to 295 has been a little tricky, but supportive price structure has finally appeared. The higher low at 305, and the .382 support bounce at 295 offer clear reference points to measure risk from. At the same time, it is also reasonable to expect at least a retest of the recent high in the 350s which makes for a reward/risk scenario that is attractive for a swing trade. As long as the 295 support holds, price action should be more on the bullish side. IF 295 breaks again, and the 286 low is compromised, that will negate the bullish structure that is in place. And in that scenario, I will be stopped out and will stand aside to reevaluate. Comments and questions welcome.
BITFINEX:ETHUSDLong
by MarcPMarkets
60
ETHUSD Perspective And Levels: Watching For Higher Low 290s.ETHUSD Update: Price reaches the 286 support area and rejects it with an initial push back to 310. This may be the beginning of a bullish reversal formation on the larger time frame and I am WATCHING carefully for a new swing trade long. BTC and the rest of the markets broke supports and pushed lows, which is interesting because when BTC pushes highs, these markets are not so quick to follow, but when it is pushing lows, the follow the leader behavior shows up again. With that being said, this market has reached even more attractive support areas for a swing trade long. The 295 support is the .382 of the entire bullish swing which broke but the 286 level which is an area of repetitive buying not only held, but got a rush of bullish price action taking this market back up to 310. Often sharp bounces like these are the beginning of a momentum change, in this case back to bullish. The other great thing about this situation is risk can be clearly defined by the 286 level. So my plan is to wait for a retrace possibly back to 300 or slightly below and look for a swing trade long entry. If a price area between 300 and 295 can show a bullish candle, I will look to go long in that area with a STOP AT 284. Once again to control risk, I will start with a smaller position of 25% of my usual position size. My target area is in the high 330s. Reward/risk is about 2.5/1. Also if I manage to get long and price is behaving the way it should, I will look to buy the other 75% of the position upon an upside break of 310 (AFTER I am in my initial position, otherwise I stay FLAT). Buying into bearish momentum is a process that requires strict attention to risk. It is possible for this market to keep selling if the 286 level is taken out again. The next support is in the 258 to 232 zone which is the .618 of the entire bullish swing. If price retests the lower support zone, that would signal to me that a consolidating market is more likely to follow rather than a retest of the highs. Either way, that area can offer swing trade opportunities as well (adjusted with more conservative targets). In summary, sell offs such as these are where the lower risk buying opportunities often reveal themselves, not at the highs especially when everyone is "painting rockets" as one trader once so eloquently described. It isn't easy though because the randomness of the market is always throwing curve balls, that is why keeping risk minimized is so important during a time like this. Absorbing small losses while seeking to buy into a supportive area is not that uncommon, especially with the amount of emotion that leads to large price spikes. I will be watching the low 300s to 295 area for reversal signs and look to reenter long there if my criteria is met. Let's see what happens. Comments and questions welcome.
BITFINEX:ETHUSD
by MarcPMarkets
43
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
LTCUSD Perspective And Levels: Retesting 50 Support.LTCUSD Update: While these markets slowly retrace, this market is following as expected, and I wanted to point out some important levels to consider as the price action unfolds. First let's begin with the 55 level which is the .382 of the broad bearish swing. This level is the current resistance that is keeping this market in the low 50s. The fact that price has formed a double top and is still in the process of retracing is certainly a sign of weakness which makes sense in a generally weak BTC environment. What is interesting is the 50 support level which it has retested a second time and retracing higher. This double bottom formation is the kind that offers opportunities on smaller time frames. If this double bottom holds, price action will have established a higher low as well (relative to the 44 low.). The minor lower high at 52 will have to be taken out in order to confirm the double bottom. So what does this mean? This pair is building a bullish structure, in the face of a somewhat weak BTC. BTC and the alt coins are slowly selling, but it is not overly bearish, especially since the 4104 level has still not been taken out. If that market manages to to hold up, this market is more likely to push higher because it is acting relatively strong. Even if the 50 level breaks, it still has the 49 to 47 support area (.618 of recent bullish swing) to get through as well. A lower high (55 to 57 area) should lead to a lower low, and if the new low fails to unfold, it is reasonable to take that as a sign of strength. Keep in mind I am not saying this market WILL fail to make a lower low, I am just sharing how I will interpret this price action IF it does. In that scenario I would also expect to see a more bullish price action in BTC as well. To make it clear, these markets are still too risky for any swing trade longs, so I do not intend to take any, BUT if price action starts showing clear signs of bullish momentum on the bigger picture, I will be looking for an opportunity to open a swing trade in this market. It is certainly worth keeping on your radar. In summary, I am seeing relatively bullish structure forming in this market while the other markets contend with bearish price action. This hidden strength can lead to higher prices if BTC manages to push through it's major 4550 resistance zone. In a bullish scenario, if the 57 level is taken out, this pair is one I would consider buying on a subsequent retrace. Of course IF BTC falls apart, which is what I have been anticipating, the only buying I will do is at the extreme lows (if these marekts offer such an opportunity, which again is not a swing trade). Overall, this market is certainly one worth keeping an eye on as we wait for BTC to choose which way it wants to go. Comments and questions welcome.
BITFINEX:LTCUSD
by MarcPMarkets
12