Bitcoin. Is this the Dip ? Will there be more Squealing ?
Just an OPINION. If it is useful please LIKE and FOLLOW. Thanks.
Important things to see in this chart:
Fib levels taken from the swing that started in 16 March 2020.
Fib levels also taken from the current dump. that started on 14th of May.
There are 4 important things we noticed:
1. Mini Gap. At the 18k - 19k level which aligns mainly with two things.
a. A potential AB/CD with 0.618 retracement and a 1.618 extension. There is the first leg, anf perhaps it needs a second leg for the movement to complete.
b. The scariest is that it aligns with the Volume Profile ( in which most trades occurred at the 18k - 19k level from 17th of September 2020 to 25th of May (today)). Perhaps it is here where institutions are waiting or bidding the price to re-enter.
c. It almost aligns with the 78.6% retracement level.
2. Big Gap. Aligns with the measured move down of the head and shoulders exactly at the 26k level.
3. Filled Gap. Rising wedge that mutated into a Head and Shoulders Pattern. Observe the Gap in the head (57k - 60k), which was already filled by the right shoulder.
4. Gap to be filled. Produced almost before the Head and Shoulders breakout (46k - 48k). It aligns with the 61.8% fib retracement level of the current dump. There is a high likelihood that it will be filled in a short squeeze.
To many people were longing before the dump, it is evident in all the liquidations that triggered in the mega dump down to 29k - 30k, guess who bought the panic, the smart traders which obviously immediately sold once they saw price rise to people that thought they were buying the dip. Now the most obvious things to do is to short right ? or perhaps buy the dip? Guess what, the market will short squeeze all those positions, and the saddest part will be that again when price is at a risky retracement level people will buy, and guess who will be selling them, the smart traders. People who bought the dip will double down at the top of the retracement most likely with margin to only see another horrible dump to 18k - 19k. Just think, when something is very obvious, and most people believe in that obvious fantasy searching for opinions and tips to keep their nerves down, price usually goes against them, and money is transferred to smart traders. The best guess is that this market will set another trap to continue taking money away from people that do the obvious.
Conclusion: See black arrows. It is just an educated guess based on TA and that's it. It is not a prediction just an opinion of what we believe will be the trajectory of Bitcoin. Our nature is always to do the obvious, and in trading sometimes you just have to do the not so obvious thing. Sometimes it happens that the price goes our way doing the most common things, but as this happens, we risk more and more, we margin more and more, we loose sense of all risk whatsoever, and guess what once we feel kings of the world the market will smile and move against us, it takes just one small move to wipe out many people because of the excessive margin taken in the exchanges. The most important thing is capital preservation and to live and fight another day.
Just an OPINION. If it is useful please LIKE and FOLLOW. Best of Best.
Important things to see in this chart:
Fib levels taken from the swing that started in 16 March 2020.
Fib levels also taken from the current dump. that started on 14th of May.
There are 4 important things we noticed:
1. Mini Gap. At the 18k - 19k level which aligns mainly with two things.
a. A potential AB/CD with 0.618 retracement and a 1.618 extension. There is the first leg, anf perhaps it needs a second leg for the movement to complete.
b. The scariest is that it aligns with the Volume Profile ( in which most trades occurred at the 18k - 19k level from 17th of September 2020 to 25th of May (today)). Perhaps it is here where institutions are waiting or bidding the price to re-enter.
c. It almost aligns with the 78.6% retracement level.
2. Big Gap. Aligns with the measured move down of the head and shoulders exactly at the 26k level.
3. Filled Gap. Rising wedge that mutated into a Head and Shoulders Pattern. Observe the Gap in the head (57k - 60k), which was already filled by the right shoulder.
4. Gap to be filled. Produced almost before the Head and Shoulders breakout (46k - 48k). It aligns with the 61.8% fib retracement level of the current dump. There is a high likelihood that it will be filled in a short squeeze.
To many people were longing before the dump, it is evident in all the liquidations that triggered in the mega dump down to 29k - 30k, guess who bought the panic, the smart traders which obviously immediately sold once they saw price rise to people that thought they were buying the dip. Now the most obvious things to do is to short right ? or perhaps buy the dip? Guess what, the market will short squeeze all those positions, and the saddest part will be that again when price is at a risky retracement level people will buy, and guess who will be selling them, the smart traders. People who bought the dip will double down at the top of the retracement most likely with margin to only see another horrible dump to 18k - 19k. Just think, when something is very obvious, and most people believe in that obvious fantasy searching for opinions and tips to keep their nerves down, price usually goes against them, and money is transferred to smart traders. The best guess is that this market will set another trap to continue taking money away from people that do the obvious.
Conclusion: See black arrows. It is just an educated guess based on TA and that's it. It is not a prediction just an opinion of what we believe will be the trajectory of Bitcoin. Our nature is always to do the obvious, and in trading sometimes you just have to do the not so obvious thing. Sometimes it happens that the price goes our way doing the most common things, but as this happens, we risk more and more, we margin more and more, we loose sense of all risk whatsoever, and guess what once we feel kings of the world the market will smile and move against us, it takes just one small move to wipe out many people because of the excessive margin taken in the exchanges. The most important thing is capital preservation and to live and fight another day.
Just an OPINION. If it is useful please LIKE and FOLLOW. Best of Best.
Comment:
If price takes too long consolidate then there is a potential of a direct flight to 20k. For now everything seems to be in a range, but if the range gets too tight for too long the direction is more uncertain. For now it seems that it wants to reach the 40k, and it will be challenging to break it but is very possible. There is never 100% certainty, never absolutely.
Comment:
There was good volume on the 4hr today, which marked in my opinion a good more less solid support.
“All fixed set patterns are incapable of adaptability or pliability. The truth is outside of all fixed patterns” BL
Trader Since 2016. Industrial and Operations Engineering at U of Michigan, Ann Arbor. MBA IPADE. Master in Finance EGADE.
Trader Since 2016. Industrial and Operations Engineering at U of Michigan, Ann Arbor. MBA IPADE. Master in Finance EGADE.
