"Buy the rumor/Sell the news" is a phenomenon as old as markets. It was like betting on the sun not to rise tomorrow.
I have talked to many Bitcoin enthusiasts who are perplexed by this occurrence. They were assured by various Twitter personalities that this week would see the largest inflow of capital into Bitcoin ever, price would rise, and if they just bought prior to the news they would make tremendous gains. This was never going to happen.
With the close of the prior eventful week's candle we now have a confirmed price Spike on the INDEX:BTCUSD Weekly. On Wednesday amid the "buy the news" nonsense price briefly surpassed a major high set in March 2022 only to retrace the entire ETF launch and then return to the bottom of the prior range. This is a very bearish signal from which price does not typically recover.
The first level of Support will be found around 32.2k; the 50% Retracement of the rally since November 2022. The most ironic, and most likely outcome, is that price retraces the entire ETF hype rally.
Breaking the ETF news high would of course resume the trend upward but at this point despite the memes circulating Twitter trying to reassure all to HODL that is a very low probability with the price action we have seen.
I remain short Bitcoin via pre-existing ETFs such as AMEX:BITI and will be adding to them during the coming week.
Wall Street is not coming to save your longs...
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I'm going to be patient and wait for one of these two conditions on adding to Bitcoin short.
Bitcoin is being resilient against the top of the Daily cloud which continues to define the trend. A pullback up to the 50% of the news spike and drop AND/OR a breakdown below the cloud are the points I am watching for now to add.
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With today's push down price has hit the Support of the Daily Ichimoku cloud. Bitcoin does not become "bearish" trending until price breaches the cloud AND momentum (the lagging span) clears it bearish as well. That is at least 2 weeks away. Giving up 40k support is a very scary thing for people that are long... but it's just one of those fake outs as I suspect.
All that being said... this presents an opportunity to adjust my options positions by selling shorter dated Puts against my longer dated Puts in MSTR and BITO. I do not want to buy calls because ultimately I want to offset the theta decay while still betting on a snap back up in Bitcoin price.
What I am looking for now is a pullback up to 44k to add to my Bitcoin short with BITI shares. My long term thesis is: "The Halvening pump, which all are betting on, will not materialize... thus presenting the highest reward scenario"
Unpopular, but surely valid opinion! Thanks for your contribution, this has been selected for Editors' Picks!
AlanSantana
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Well said my friend. We need some sanity back into this market.
Great analysis.
Namaste.
fxciti
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@AlanSantana, how about the last sentence, you believe this? :)
TradingView
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Congratulations on being chosen for the Editors Pick. Thanks for sharing with the site.
blbenne0
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35% correction AFTER Bitcoin halving? Lmao. You are right there are sell the news types and then you proceed to argue against what history has shown in the Bitcoin halving charts. According to him, history will not repeat itself with Bitcoin halving, since his chart completely ignores supports at 38000 and runs through June with basically no analysis. We will not enter a bull market at all. xD
blbenne0
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@blbenne0, Update: I literally called the bottom at 38k in this post.
Brythescienceguy
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While that would make sense under normal circumstance, and would also allow ETFs to add at lower levels for their clients. There is a BTC halving in April reduce the overall supply. Obviously history does not repeat but does often rhyme. BTC has always rallied into and after this halving traditionally.
norok
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@Brythescienceguy, I wrote about this thesis in my prior article "My 2023 Bitcoin Short". Given that this has taken place 3 out of 3 times in the past that number of occurrences is not statistically significant. It does not mean there is a 100% guarantee. Many are expecting this rally to materialize just as they were expecting the ETF launch to catapult Bitcoin much higher. The contrarian trade is to bet against a halvening rally.
Modal1
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That’s bullish
MyCryptoParadise_Nathan
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Your detailed examination of the confirmed price spike, retracement, and the potential bearish signal provides a clear picture.
Thanks for your contribution, this has been selected for Editors' Picks!