Bitcoin fractal downtrend comparison and demand drop! (Part 1)
As in every market bitcoin price changes come from supply and demand. The supply changes slowly relative to the daily fluctuations in the price so we can consider the supply relatively constant on daily trading timeframe. Most of the demand comes from speculation. Therefore, by tracking the public interest changes we can relate it to the price movement. The best way I found for doing that is by checking the traffic on binance and coinbase with alexa website.
Looking at the Alexa rank 90 day trend, we can see that the interest has already peaked a few weeks ago as the price was around 13k - 14k. Since then, there is almost linear downtrend in the Alexa rank. Considering that as a short signal and that the top of this move is 14k, the second part of the analysis comes in.
We can think of the bitcoin price movements as mass psychology reflection of fear and greed. Therefore, fractal relationships between uptrends as well as downtrends might exist reflecting the repeating patterns of buying and selling from mass psychology. In this Part 1 and the next Part 2, I will show more evidence of this fractal relationship between the last downtrend from 20k to 3.5k and the current one from 14k.
The yellow ellipse represent the bull trap and in both cases it reaches similar retracement percentages (around 65%). The blue ellipse is where I think we are currently at. If this fractal relationship continues we should see a sharp drop in the coming days to 8k, followed by a move up to around 9.5k, then followed by a sharp move down to around 6k.
Of course, there are no guarantees for that and the short position target will be updated as more information becomes available but for now first target is 8k.
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For the next two months, I will be posting free trading ideas in crypto, stocks and commodities.
Like and follow me for the next Part 2 tomorrow when I am going to dive in the fractal relationship between the two downtrends.
Looking at the Alexa rank 90 day trend, we can see that the interest has already peaked a few weeks ago as the price was around 13k - 14k. Since then, there is almost linear downtrend in the Alexa rank. Considering that as a short signal and that the top of this move is 14k, the second part of the analysis comes in.
We can think of the bitcoin price movements as mass psychology reflection of fear and greed. Therefore, fractal relationships between uptrends as well as downtrends might exist reflecting the repeating patterns of buying and selling from mass psychology. In this Part 1 and the next Part 2, I will show more evidence of this fractal relationship between the last downtrend from 20k to 3.5k and the current one from 14k.
The yellow ellipse represent the bull trap and in both cases it reaches similar retracement percentages (around 65%). The blue ellipse is where I think we are currently at. If this fractal relationship continues we should see a sharp drop in the coming days to 8k, followed by a move up to around 9.5k, then followed by a sharp move down to around 6k.
Of course, there are no guarantees for that and the short position target will be updated as more information becomes available but for now first target is 8k.
For more information on how to get a free trial of my fund, feel free to message me.
For the next two months, I will be posting free trading ideas in crypto, stocks and commodities.
Like and follow me for the next Part 2 tomorrow when I am going to dive in the fractal relationship between the two downtrends.
Comment:
We very close to breaking down this bear flag. We will see soon whether it is going to happen. But the volume profile is good. It was increasing on the downside before the bear flag and decreasing in the bear flag.
Comment:
We didn't manage to break the support of the bear flag last time. We just held at it. Now we are close again on very low volume:
Moreover, the traffic on binance and coinbase continues to plummet:
www.alexa.com/siteinfo/binance.com
www.alexa.com/siteinfo/coinbase.com
Moreover, the traffic on binance and coinbase continues to plummet:
www.alexa.com/siteinfo/binance.com
www.alexa.com/siteinfo/coinbase.com
Comment:
We couldnt manage to break the bear flag last two times. But now we are close to it again. I am showing a possible Elliot count for the correction assuming the top of the correction is in and we are headed down. I think we are soon likely to breakdown with large sell volume.
Binance traffic is still trending down:
www.alexa.com/siteinfo/binance.com
www.alexa.com/siteinfo/binance.com
Comment:
The Elliot count turned out to be a good guide this time. We finally broke the trend line with lots of volume as expected. If you missed the short, there might be opportunity to reenter in the region around the red box.
Comment:
If you missed to enter a short position, this is potentially a good point to ride BTC down to 8k or below.
www.alexa.com/siteinfo/binance.com
www.alexa.com/siteinfo/coinbase.com
Look at the Alexa Rank 90 day trend