Pink = 20
Blue = 200 DMA
Main (2014 start)
1: We don't need to regurgitate how awful 2018 has been for BTC and crypto markets as a whole. We have found ourselves in the top 3 worst recessions so far in BTC history measured in terms of price correction + duration. So congratulations if you're still playing the market with some success. The positive takeaway I've had trading in this market is really fine tuning my trading + RISK MGMT strategies. I put RISK MGMT in ALL CAPS for a reason here. Everyone can make money in a bull market. But it's times like these is when you get tested to see if you can break even. So if you've been a victim of losing some trading capital this year hopefully this has made you a more technical trader using classical charting techniques, knowing how to identify resistance/support zones as well as employing strategies early so you don't react emotionally.
2: Let's get right to it. So the basic idea behind this chart is my 2 year outlook for BTC . Sometimes is good to pan out a bit and come up with an overall strategy. Yes it could be completely wrong and the market reacts much differently, but that doesn't matter. What matters is you have a plan and contingency plans underneath it. Future projections can always be adjusted to fit a new strategy. I'd rather be in a position where I have to fix a line on a graph than trying to make up 3% capital loss on a trade because I didn't have any foresight.
3: If you start from left to right you'll see I mark an important indicator. Whenever the 20 crosses above the 200 DMA this marks very strength in Bitcoin (as well as any other asset). So for you investor types who want to get into BTC when it's the safest with a long term approach, this might be the time. You'll see when these lines crossed BTC went on a multi-year bull run before the parabolic curve in late 2017.
4: I do believe BTC needs to go much lower triggering all of the stop losses before we go higher. This is obvious in all momentum indicators as well as . Whenever we start to see a mini bull recovery it's always a Higher Low. We have been trading inside a that everyone and their grandma is aware of now. Obviously critical support is around 5800. If BTC sustains below this for a daily candle close I believe Buy Zone 1 will be where smart money will being adding to long term holdings. Now if things go to plan I believe BTC needs to do a VIOLENT V bottom recovery triggering all the stop losses. This will flush out all the speculators and sellers will begin to dry up. The lower end of Buy Zone 1 and early stages of Buy Zone 2 will not be possible to short. What we should see is once all those stop losses get triggered BTC within a couple of days recover back up to the bottom of the . So in a matter of 1-2 days we should see over a 1k-2k price recovery. If it doesn't this could signal disastrous scenario and The dead Zone 3 could be in play. I would not trade Zone 3.
5: BTC has to respect this multi-year if we have any hope that 2019-2020 will be positive. BTC will probably break it but then needs to quickly recover to find it as support. Before the parabolic curve in late 2017 I mentioned that there was a approx a 2 year BTC growth period that was pretty reasonable respecting that . I simply mirrored that price action after the V bottom and you'll see getting to 40K by Dec 2020 isn't out of the question.
*Green = 200 DMA