DSchutz

BTC - A Rational Outlook

COINBASE:BTCUSD   Bitcoin / U.S. Dollar
This may not be the best time to put out a technical update, but given the hysteria surrounding this rally, I figure I should add my opinion to the mix. To clarify my first point regarding the bad timing of commenting on a technical update, BTC is very much in the void at the moment. If you look at the chart, you will notice there are absolutely no reference points between 11600 and 17000 (at least, no significant reference points). We could surge straight to 17k , or maybe we will see a correction back to 11600, or even 10k. The point is, we need inflection points in the price action to use as reference points going forward. In most cases, we say we need greater volatility , in both directions, to create the zig zags in price action on the chart. In the case of BTC , we have had an explosion in volatility this year, but for the most part it has been predominantly upside volatility . Without some downside deviation, things will remain absurdly parabolic, with nothing to reference and little information to trade on.

So what does this all mean? For now, if you’re long, sit tight ad enjoy the ride. If you’re worried about BTC getting a bit overextended here (A very rational concern at this point), and fear a larger correction, put in some stop losses around the previous levels of support we’ve been watching (11600 or 10000). However, keep in mind, a retest of the previous top near 20k is not outrageous given where we are trading right now. Just a 50-55% move and we are back at 20k.
Jun 26
Comment: Big surge up to 13600, almost 1000 more from when I originally posted this update. A lot of this could be driven on FOMO. Continuing to watch closely.
Jun 27
Comment: We now have a correction back to 11600, the exact level pointed out in the original post.

Comments

@coinzada, Not sure if my previous comment posted, so re-replying to you now. the 10% correction number is typical for retail investors, but for traders you will find we use it synonymously for any pullback. It's all relative. For a trader using weekly or monthly bars on BTC, 12800 to 11600 is not much of a correction, but for a trader using daily bars or any time frame less than daily, 9% is a correction.

Regarding fibs, check out these links
https://adamhgrimes.com/testing-fibonaccis-12/
https://adamhgrimes.com/fibonacci-conclusions-22/

I lump fibs into same category as Elliott Waves. We can find charts and make it fit, but it's mostly confirmation bias. Never use it as a sole reference point. Remember this, technical analysis is just the study of supply and demand. Markets are not driven by a mysterious or mystical force that relies of the magic of the Fibonacci ratio.
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1) A move to 11600 would hardly qualify as a correction. 2) No reference points? HUH? How about for one the 61.8 retracement from all time highs...
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DSchutz coinzada
@coinzada,

1. A correction in price action can be to literally ANY degree. At this time BTC is around 12800, a move to 11600 would be about a 9% change. That's a small correction.

2. Fib retracement from all time highs? Not sure what you're pointing to exactly, feel free to drop a link or pic in a comment.
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@DSchutz, A move needs to be greater than 10% to be considered a correction, source: https://investinganswers.com/dictionary/m/market-correction

61.8 fib:

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