TradingShot

BITCOIN The BEST BUY SIGNAL we will ever get.

BITSTAMP:BTCUSD   Bitcoin / U.S. Dollar
Following my recent publications on the similarities of the current trade set-up since the early March bottom with the pattern after the December 2018 bottom (you can see all of them at the end of the analysis), I am taking it today a step further by looking into the potential duration until the next bullish break-out and most importantly the strongest Buy Signal of this sequence that may occur soon (1-2 weeks). That has to do with the LMACD (Logarithmic MACD ). For better comparison reasons and illustration of the long term, I am using the 1W chart.

** Before we start please support this idea with your likes and comments, it is the best way to keep it relevant and support me. **


** Where are we now? **
After the March 13th Bottom, Bitcoin has made a strong rebound off the 1W MA300 (black trend line ) and has found base within the 1W MA200 (orange) and 1W MA50 (blue) trading solely within the two for the past 4 weeks (counting the current candle as well). Compared to the violent swings of early March, we can treat this 4 week trading sequence as a "consolidation".


** The 1D MA50 is so far the Resistance **
This consolidation may be strengthened and extended more as long as Bitcoin fails to break the MA50 on the 1D chart. So far it is failing and as you see on the previous idea below, the price has been rejected:



** Cycle 1 vs Cycle 2 **
If this consolidation is extended then we may have a similar pattern as in January - March 2019 (the subject I've been discussing for a long time). Since the two mini Cycles (December 2017 - April 2019: Cycle 1 and June 2019 - date: Cycle 2) are comparable then we can assume that the current bottom/ consolidation phase is proportionate.

- Cycle 1 duration from Top to Bottom was 52 weeks and from Bottom until the time it broke the 1W MA50 was 19 weeks.
- Cycle 2 duration from Top to Bottom was 37 weeks which is 71% of Cycle 1. Assuming the duration from Bottom until the time it breaks the 1W MA50 again is proportionate then 71% of 19 weeks is 13 weeks.


** The Strong Buy signal given by the LMACD **
During this consolidation, the LMACD gave a strong Buy Signal in February 2019, in fact the strongest in the past +2 years. As you see on the chart it was the 2nd Bullish Cross of Cycle 1 that basically confirmed that the bottom was in and halfway through the consolidation phase gave the strong Buy Signal. At the moment the LMACD is about to make (this week or the next) that same Bullish Cross on Cycle 2 as well. In fact that will also be the 2nd Bullish Cross of the Cycle. In both Cycles the 1st Bullish Cross occurrences on LMACD proved to be a fake signal as new Lows we followed. The Bearish Crosses though on both Cycles have proved to be very accurate as the 1st marked the Top and the 2nd the coming of the Bottom. As you see the similarities of the two Cycles, even in terms of LMACD are uncanny and the trading patterns as symmetrical as they can be.


Based on this chart it is obvious that the upcoming LMACD Bullish Cross is one of the strongest (if not the strongest) Buy Signal we can get moving forward and a similar opportunity my not present itself. There should be little doubt in our minds that ahead of the May Halving (3rd in BTCUSD history) the Bottom is in (unless of course the COVID pandemic proves to be much worse than we expect and markets crash worldwide). Traders who want lower risk can wait for the LMACD (2nd) Bullish Cross for confirmation, though long term investors can continue accumulating on every pull back they get. The Halving has been historically BTC's call for the start of the new multi-year Bull Cycle and we are only a few weeks away from it.

Do you agree that the LMACD's 2nd Bullish Cross is the strongest Buy Signal we can get or have another signal in mind? Feel free to share your work and let me know in the comments section!

Please like, subscribe and share your ideas and charts with the community!



P.S. Keep in mind that Buy Signals on Bottoms are not that difficult to be found if you look carefully at similar sequences. Take a look below at how obvious of a Bottom the 3k range was in 2 studies made in February and March 2019 respectively while BTC was still around $3500!




As mentioned at the start of the idea, these are a few of the recent studies on the comparison of the two Cycles:





** BONUS MATERIAL: The LMACD has been particularly useful for me in the past, accurately depicting buy and sell entries on solid trend **


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Comments

Well good analysis but if you look to the pattern more closely, as you tried to do, we should be actually in a 3rd Sep 2018 kind of week. The difference is, we crashed earlier than 12th Nov 2018 week as it is shifted a bit. So, a test of the bottom should be ahead within 1-2 weeks and then a bottoming process for about 8-10 weeks and only after that... up we go!
+10 Reply
@cmbaar, That is another way of viewing it and it can of course be right. I believe it is the fact that we are so close to the Halving that makes all the difference.
+4 Reply
kardia TradingShot
@TradingShot, I'm sorry to break this to you, but it's likely that Bitcoin is finished. Miners are capitulating and selling their equipment. Big investors are bailing and moving into cash. BTC will likely not recover. And if this is true, the crypto market will surely implode in due time. People are sick of all this pump and dump nonsense. The halving is Bitcoin's last chance. If nothing substantial happens, then that will be a major red flag. I may cash out of everything and leave this space.
Reply
Comment removed.
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