MarcPMarkets

BTCUSD: How Indecisive Price Action Reveals Strength.

BITFINEX:BTCUSD   Bitcoin / U.S. Dollar
BTCUSD update: Bullish momentum is building off of the 8171 to 4953 support zone . A break above 8427 and close will signal that the current bearish leg is complete. The next structure to anticipate is the shallow higher low formation.

What indicates strength on this chart is the previous candle which is not obvious to the casual observer. Price made it as high as 8488, which does not count as a break of the 8427 resistance because it did not close decisively above. The strength is represented by the pin bar close followed by an immediate retest of the 8171 support zone boundary.

How is this strong? Aren't bearish pin bars a sign of weakness? It all depends on the context of the situation. In this case, the bearish pin bar did not result in a break of the candle low, instead price pushes back up into resistance almost immediately relative to this time frame. That coupled with the fact that price is coming out of a major support zone makes for a stronger bullish argument.

IF there is a pull back and another bearish test, I would watch for the 7K level to hold as a minor support for a higher low. I believe this situation is less likely, but something to be aware of. IF the current strength stays intact, what is more likely is a pair of spinning tops or indecision candles which I would view as a shallow higher low, followed by a solid push through the 8427 level.

In summary, barring any negative catalyst, this is an area to consider putting on longs that is not as aggressive as buying into a market that is pushing lows. The more conservative play would be to buy when a clear higher low formation appears. The reference point for risk would be the 6600 area which is based on a proportion of the current minor bullish swing. IF this leg stays intact, the 9887 to 10636 zone is the next likely resistance target. Just like a vertical market reinforces boldness, a very weak market reinforces caution and fear. This is not a time to be fearful. Temper your risk and your aggressiveness through careful sizing, and/or basic price formations to justify a larger time frame position. What will protect you from another adverse move is your management of risk, not waiting for the perfect moment to enter.

Questions and comments welcome.
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Comments

When you say price close.. According to what time is the close? Like in american stocks for example the close is the actual time the nyse closes but in cryptos its 24/7 so what time counts as 'close'?
+2 Reply
@samirabdulsalam, I think it's GMT... could be wrong though...
Reply
chwi03 apdodog
@samirabdulsalam, from my understanding, in crypto the standard for the daily close is UTC.
Reply
ndoostyar apdodog
@samirabdulsalam, UTC, london time
Reply
@samirabdulsalam, Midnight GMT/UTC. Equates to 7pm Eatern Time in the US, 1am across most of Europe, etc. You can set the time setting on TradingView charts to your time zone and see the close in your own time.
Reply
stell_s1 apdodog
@samirabdulsalam, his chart is on daily timeframe.
Reply
love this email, keep it up Marc.
+1 Reply
Bitcoin seems very unstable, will try to rebounce in a channel (7900-8300) if main support (which failed to hold when needed) holds long enought.
Most probably we won't see prices above 9k, nor higher than that.
Bitcoin will drop to 5,4k, then raise to 7,4k, then drop bellow 5k.
Dont rush with Bitcoin, it's very unstable.
Chart are chronological




Regards Marc
+1 Reply
Comment removed.
milanjelic CryptoCyberpunk
@CryptoCyberpunk
maybe you shot post something instead of commenting only, so we all can benefit of it?
Reply
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