Bitcoin - Looking for Value Vol.14 : HypothesisAfter the motivation had subsided and the "healthy" correction started, I thought to myself I would do another episode of the exciting series> Bitcoin looking for Value <.
Since I sometimes work on the articles in several stages, sometimes new impressions come in in between, which I incorporate and which steer my flow of thoughts a little off the rails. Sometimes I'm a bit scattered, but in the end everything usually comes together. So also in this post ...
After I expressed my concerns about a possible price decline in my last post "1% Club" and received a lot of encouragement: Thank you very much for every single like! That made me really happy! Now that the correction has started, I'm of course annoyed about my stubbornness not having sold a portion of BTC and of course not that amused. But in the end it can be sausage, because one way or another I hang on the BTC and like it exactly where it is currently: on my wallet.
A mega awesome sentence from the comment section will accompany me forever: The Bitcoin is a digital Picasso of the financial industry and a Picasso is not so easy to sell. With this phenomenal wisdom I can live great and deal responsibly with any correction. Many thanks to the user AdGt for this great sentence!
But further in the topic :::
In fact, the BTC has apparently found its value for the time being: $ 40,000 is a very, very proud sum ... brutal how quickly you get used to these heights ...
A lot has happened since episode 1 of this ongoing series and I am very happy with where this odyssey has taken us or me so far. For me this is my BTC diary and I like it ... In the first episode I had no idea how it should go but and meanwhile the story is slowly building up and actually starting to make sense.
If we look at the various volume profiles that are visible on the chart, we can see some nice distribution curves, which now serve as stable and fundamentally and actually existing static trading levels.
I like to draw these zones / volume profiles over blocks of price action, from swing to swing, over correlations and how it makes the most sense for me. Here you should just try around until you are happy.
Similarly, I also like to do it with price action, I tune the timeframe until it looks like I'm happy with it.
In any case, the market has built a very nice structure for us here and created some very nice balance ranges aka happy ranges that we can work with from now on.
I really like to use the happy ranges to do destination trades, which is nothing more than a test of the other side of the value area when we break into a balance.
Of course this doesn't always work, but often enough that it is super profitable and a complete "trading system". I hate that term, but it makes things a lot clearer.
Currently (that was yesterday ...) at the time when I am sitting on the post, the price is below the last full VA and even if I don't like to say it, I have the impression that we are going to go deeper here and correct further. But since I wrote these lines yesterday and the price has achieved its goal: to achieve value area high, the hypothesis is void.
Now it would be great if the price is accepted and traded at the current price level so that all market participants, algos and quants agree that we all want higher prices.
Great that the price actually made it and made these lines possible.
Every VA that is below (and of course above) the current level acts as a possible S / R zone and offers scope for a small bounce or even a complete reversal towards new ATHs (that would be nice, wouldn't it?). Whether that is likely or not, no one can determine in advance, the rational mind of course continues to assume that prices will fall, which would not be so bad, because quite honestly: the BTC has done its job and can rest for a while. However, we live in crazy times and why shouldn't the price just keep rising? Nobody Knows. And as of today: Fire at once again ATH :)
The price moves to where momentum / acceptance and lots of transactions are processed or where the “demand” comes in in the form of market orders. If the market is hard short, then everyone who notices the momentum shorts until a market participant big enough says stop and slowly but brutally brings the price back up on track. Apparently someone has changed the course, which means that people are buying hard again. Momentum is up, so every Algo and Quant is buying everything up the price ladder.
Based on my article about the "Squeeze and the Innovation Curve", the weak hand hipsters could simply be liquidated from the market (has it already happened?), The inventory (was the market too long?) equalize and then when everyone is stopped ... it goes up again diligently and in big steps - as we can see today, this is exactly what has occurred.
With the contributions I try not only to add value for the community but also to "perpetuate" a beautiful picture book of my ideas and thoughts for myself. I think it's great that everything fits together so nicely and that you can actually learn something from it. Even while I'm writing this stuff, I keep coming up with cool ideas that I then like to implement or try out afterwards.
The oblique connection with the value area trend lines was created freely when drawing. And only now do I notice that it was actually an extremely smart thing. I'm not a big fan of trend lines, but from now on this "variant" is a great way for me to add a variant of a "value trend line" that makes sense to me in my personal toolbox. At least it looks very promising. We'll keep watching. Stay tuned!
#BtcUsdT $BtcUsdT #Btc $Btc
Nv
.:Static & Dynamic Value:. Small gimmick as a little push how nice you can set up here on TV to make the trading experience a "tick" more pleasant.
... In addition, while writing I spontaneously came up with something about, let's call it self-discovery from the own trading personality...
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The Volume Profile is a brilliant tool, not an indicator, and the whole professional trading industry looks at it. The same goes for the Vwap .
However, you don't HAVE to use it if you don't like it. But what I personally always prefer and recommend is to form your own opinion about something.
You should never rely on what others say but always form your own opinion. Because mostly the majority is wrong and even if the collective whole thinks something is good, it doesn't have to be good.
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So if you don't like the volume profile and can't get anything out of it, you should probably do it. try the VWAP before throwing in the towel. Or you are really crazy and try to combine both, which can be pretty awesome ...
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The volume-weighted average price has more to offer than simply being the "average price".
I like to use it as "Developing / Dynamic Value" in combination with the volume profile . The interesting thing about this thing is that it is not just an arbitrary indicator, but a visual representation of the actual transactions. What makes the VWAP so dynamic is the function of the bands based on the calculation of the conventional distribution curve / Gaussian distribution. This can give clues about volatility , rhythm and patterns. The bands of the VWAP are extremely sensitive, as many "digital eyes" of the Algos and of course a few of the remaining human eyes look at them. That alone is enough as an argument why you should look into the matter more closely - you don't have to.
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The chart is BtcUsdT and I have compared the volume profile with the weekly Vwap with the 3 standard deviations shown as bands in the charts above.
You can see that we get a nice value area from both tools that are almost identical.
I do not want to go into detail here on the use of the tools. Youtube and Google provide tons of material to learn and study. It should just create intention to dig into this beautiful topic.
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Many traders are looking for the holy grail, the perfect system, the secret technique that opens all doors.
A very well-known streaming provider is currently running a very ingenious series about a young lady who is a chess genius. In one of the later episodes, a young man says to the lady - who thought he would like to become a professional chess player - that the time together (the two trained together for a tournament) revealed to him that he doesn't like chess ( cf .) so much loves like the lady and that he has recognized that it is apparently not his destiny to become / be a professional chess player. What I want to express with detours is that the holy grail is devotion / love / obsession - call it what you want - the door opener. You should allow yourself a lot of time to find your true trading personality, be it instruments, tools, platform etc. and make these things your own. You only get really good if you really live what you do. One can think or know something. You should be able to feel the difference. As in trading, it's the obvious things and not the stuff that you have to look for with a magnifying glass.
Just because the tools / techniques / strategies exist and they work for others doesn't mean you have to force it on yourself. Concentrate on your interests, what you enjoy and what you just find awesome.
I hope that I have aroused a bit of interest in some topics and I wish everyone a Merry Christmas!
$BtcUsdT #BtcUSdT $BTC #BTC