The goal of this chart is to point out to you that YOU WILL NEVER EVER be able to buy LOWEST or sell HIGHEST...but that's ok. We buy the average and still profit big time. This exercise will teach you how to know when we are in accumulation zone and when to STOP over trading and losing CAPITAL!
If this is the first time seeing this chart start from left to right and get familiar with market cycles, the notes and overall structure I'm pointing out during the 2014 and 2018 bear market. I then project how BTC could react in the future.
The blue moving average line is the 200 DMA (most trusted moving average to establish what cycle of a market we are in i.e. Bullish or Bearish).
Many analysts are spreading FUD or crazy bullish calls. I'm here to present facts and decent probabilities so we can strip away emotional FOMO type of trading. Too many traders get wrecked in range trading and let's face it...it's nearly impossible to do well in a range or when the market is accumulation zone. Why? It comes down to psychology. Coming out of 50% drop in the market traders on both sides feel nervous. They feel at any moment the market has to either break much lower or higher depending if you are bear or bull. So what happens normally bears use too much leverage when shorting getting margin called all the time. On the same note Bulls naively think the market is about to breakout to ATH's and over extend their buying positions forcing them to keep stops close...which ultimately get triggered to a lower shadow wick. My goal here is to teach you when SPECULATION PHASE IS OVER and when it's time to BUY/HOLD strategy.
Now that you've familiarized yourself going from left to right and understand the story I'm telling...lets bring your eyes down to the following grid on the chart.
2014 - Accumulation Zone:
Here I found the best two daily candles if one was lucky enough to buy in 2015 after market capitulation. You will see the high price at top ($321), middle price ($217) or the close price and the lowest price ($152) for the day.
Notice first that these candles are 220 days apart! This goes back to what I pointed out before how hard it is to successfully trade when in accumulation zone. So many traders will lose during this 220 days because both bulls/bears will get either margin called or stopped out depending on how you are trading. The majority of the 220 days also was trading between $220 to $270. Sorry, you're not that good to be day trading in this kind of range to make decent money.
Notice that close price between these two buy zone candles is ~$220 dollars. This is the low. The LOW people. The low end of what I just said was where BTC spent most of it's time for 220 days! So if you just bought and held the close price you're good!
Also look at the indicators below. I have stochastic and RSI. Since 2011 using RSI has always worked for long term bag holders. Whenever you get a chance to buy when BTC is wayyyy oversold on the daily timeframe. BUY! The proof is there.
2019 - Accumulation Zone:
BTC entered accumulation zone when the descending triangle broke below $5,800.
To determine the middle zone price of $3,965 I simply looked back at the 2014 accumulation zone and calculated the difference between that High ($321 and average close $220). This is a 31% difference. So if subtract 31% from $5,745 to be exact we can get an average close price of 2019 of $3,965.
Now what's even cooler about this price of $3,965 is that if you look at when RSI hit its' ever lowest point (9.2) in history (Dec 14th) it was at a BTC low for the day at 4k.
There you go. If you buy and hold BTC at 4k or below you are a winner in the long run. Trust me. The facts are there. You are now in the zone when you need to get over speculation. It's done. It's time to start accumulating and if prices go lower dollar cost average down. If prices go higher dollar cost average up. The goal is to keep your overall price at 4k to maximize total return in 2 years time.
Good luck and don't be greedy.
Bobby -Don't hate the hair, hate the game
Trade active
⋅
Nice way to start the week. Need to close this week 50% or above on last weeks down candle. Level is marked by green trend line. can also read the publication by clicking on image.
Very interesting read @BitcoinBobby. Thanks for sharing your views. Only started following you a few days ago, but so far I appreciate the objective quality of the content. Personally I have started to slowly accumulate as well with the intention to hold on for some years until we see it topping out. Fingers crossed.
UnknownUnicorn1615160
⋅
@DIYIrrigation, cheers mate. I like your strategy. slow accumulation on the way down.
mmmp12
⋅
@BitcoinBobby, Averaging losses all the way down, is 'good strategy'. Yea, yea sure xD.
mmmp12
⋅
@JA.piotr.bor, Should put '?' in first sentence. Still, it's not a good strategy, it's best strategy how to zero your trading account, or take enormous risk vs reward on your account (if it's without leverage).
UnknownUnicorn1615160
⋅
@JA.piotr.bor, if you don't have anything meaningful to contribute to defend your case than stop being a troll. Step up and provide some TA to defend your position or would that be too much work for you. easier to leech off other people instead right?
mmmp12
⋅
@BitcoinBobby, I'm not the one longing btc since beginning 2018, and I have one analysis on my profile rest is my private.
It wasn't ideal, but I wasn't being an idiot and longing evident down trend.
UnknownUnicorn1615160
⋅
@JA.piotr.bor, I know a lot of people who have made good money being long in bitcoin at the right times in 2018. I also know a lot of people who made money shorting in 2018. Who are you the one to call anyone an idiot for trading in a free market? You need to be more of a critical thinker vs. emotional. I can tell this is your weakness.
AlanSantana
⋅
What about your short term view?
For trading short term and with the range bound Bitcoin, it is better to trade Altcoins, these are generating great profits.
Here is mine on the 4h chart:
UnknownUnicorn1615160
⋅
@alanmasters, I agree speculation is getting more difficult on the longer time frames for BTC. I also agree that speculators have moved to smaller cap alts as bitcoin range get's squeezed. Also good call on this TA. BTC moved up nearly 5% after your post!