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Bitcoin Weekly Chart Analysis
- Last week Bitcoin closed with a green candle that completely engulfed the previous weekly yellow candle. This makes up the pattern (you can check the "related posts" for additional information on this pattern).
- We have the ADAM & EVE bottom formation, which I drew with some green arrows.
- The is showing a young crossover with the histogram turning in favor of the bulls.
- Price bounced (last week) before reaching MA200 (black line) which is a signal of strength. If Bitcoin were looking down now, it would at least challenge this , but it didn't.
- On a break to the upside, Bitcoin can easily test EMA200 (orange line) sitting at $4141.8. In order to challenge this , EMA10 ($3905.5) needs to be broken first.
Conditions for change: If Bitcoin fails to follow up on the pattern and breaks down, you can expect it to first find support at $3405.3 followed by $3342.1 (BitFinex). These levels are marked by the last low and MA200.
My view: I believe that Bitcoin will break to the upside from late Wednesday to Saturday this week. There can be small retrace/correction before this happens with a 100/150 points swing. This can be seen on my XBT LONG trade chart:
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Where do you think Bitcoin is headed next?
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NAV Coin (NAVBTC):
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Solve.Care (SOLVEBTC) is facing resistance right now. This one too can generate some massive earnings, but highly manipulated so make sure to have a trade plan if you go in it:
We are looking good on the weekly. EMA200 is the resistance to break.
Bitcoin tried to break this resistance 5 times in the past 4 months without success. A close above this level will signal good strength for the bulls.
Weekly candle closes in 28 hours.
Here is the chart:
On January 4th, we wrote a speculative trade piece for the January 16th Constantinople Fork. Today we will aim to replicate those trade ideas for the second attempt of the Constantinople Fork Implementation. According to the core developers, the fork will become effective on block number 7,280,000, which should occur on Feb 27th. When looking for opportunities in price movements on a SHORT-TERM thesis, one can use options to get long GAMMA, which essentially allows a trader to get highly leveraged exposure at a low-cost premium.
Below is BitOoda’s Option Run, courtesy of KRM22’s ProOpticus software. This tool is an effective way for us to keep track of option values, and calculate the Greek’s that would be associated with any options structure priced up for our clients.
When exploring opportunities for high GAMMA option plays, we shall look towards the March (3/29/19) options contracts, located in the left most column above. As you can see, the March $125 Straddle is worth ~$30. With the previous build-up, and ensuing let down of the first attempt at the Constantinople fork, we saw a price selloff from ~$155 to ~115 by the time the January options expired. The January $150 Straddle when we wrote our first Morning Report was also ~$30. This trade was a small winner (profited $5 from $30 premium = 16.67% ROI ).
We also recommended buying outright At-The-Money Calls or Puts if you had a conviction on price direction. As we saw, the Puts were spectacular, and the Calls were losers.
For this second attempt at the Constantinople Fork, the core developers believe this round will go off without a hitch. If you believe in what they are saying, then buying At-The Money Calls would be your best options strategy here. If you have been following our Vol updates over the last few weeks, BTC vol has been extremely suppressed due to the lack of realized volatility in the space. The implied volatility (option values) should act similarly in ETH vol terms.
The ETH H (3/29/19) $125 Call is worth roughly $12. If you can buy at the calls at this price, that would give you a break even up to $137. Viewing this ETH chart, we feel as though it is just ‘air’ up to ~$150. In other words, we don’t believe we shall see any RESISTANCE until that level as a rally could easily gap to that price.
A Forking event in any protocol has taught us one thing; uncertainty and price volatility are sure to follow. Let’s use our past experiences and observations to take advantage of these opportunities for some speculative profits in a low-risk, high-reward manner.
Thanks for the comment... Se you around.