Hi,
During the downtrend, I have found a SHORT-TERM buy opportunity. I haven't seen this set up on the Bitcoin chart for a while and I would like to share my thoughts with you about that situation.
Short-term bet against the trend.
Just a little intro, as said, we have a downtrend and we can call it even crypt-long-term downtrend because it has been "running" for quite a while. Recently the price broke downwards trough the counter-trendline and into the long-term trend direction, not just good signs to buy it but still, the setup is there and you can consider it as risky trade because this bet is against the trend. As you know, markets move on the waves and we, as day traders, just try to catch those short-term waves - at the moment, I will try to catch a short-term wave upwards from the green box to the arrow peak.
The green box marks the reversal area, and the key is a candlestick pattern.
Since the end of November, the price has got one impulsive wave downwards and currently, the second impulse (current price action) can drag the price inside the green area, which also should work as a support level and actually, as said, I expect a short-term bounce from it also - it would be nice ;)
From the end of November, the price has started to take a direction downwards inside a parallel channel. As you know, if there is a certain direction/movement then pretty often the price moves inside the channels and pretty often they are parallel channels. So, if this time it starts to move inside the parallel channel then this green area would be a perfect spot to jump a bit higher, at least a tiny amount ~$300.
Okay, enough for this talky-talky bla-bla: the green area consists of:
1) The blue parallel channel, pulled from the wicks.
2) The black dotted parallel channel, pulled from the bodies - just in case because it removes a bit more market noise from the wicks but luckily, they match perfectly with the wick-channel inside the green area.
3) 2x AB=CD, as channels, blue is pulled from the wicks and black is pulled from bodies which means that it is dragged from closing prices on the 4H timeframe.
--- Both they make up a crossing area and it stays slightly below $7,900. So, it should be the strongest area on the chart and the price definitely needs to touch this before you start to search any bullish candlestick patterns (rushed a bit ahead with that ;)
4) The round number of $7,000 should act as a support or at least a psychological number.
5) Fibonacci retracement 62% is around the area to shuffle the cards a bit, it should also act as a support level.
6) Fibonacci Extension 127% matching perfectly with our channel and AB=CD crossing area
7) Weekly EMA100 is around the marked area.
8) And now the key point, as always, wait for a bullish candlestick formation. This time it can also appear on the 1H chart BUT as said, it needs to touch that mentioned crossing area. The crossing area and the strongest price level inside the green box should stay between $6,850 - $6,910. So, a bullish candlestick pattern after the touch or inside that mentioned price zone will finally trigger the trade!!! We are betting against the trend and if you don't wait for a bullish candlestick pattern, then most of the time you are a loser without any patience - rude but simple!
Do your own research and please, take a second and support my effort by hitting the "LIKE" button, it is my only FEE from You!
Best regards,
Vaido
During the downtrend, I have found a SHORT-TERM buy opportunity. I haven't seen this set up on the Bitcoin chart for a while and I would like to share my thoughts with you about that situation.
Short-term bet against the trend.
Just a little intro, as said, we have a downtrend and we can call it even crypt-long-term downtrend because it has been "running" for quite a while. Recently the price broke downwards trough the counter-trendline and into the long-term trend direction, not just good signs to buy it but still, the setup is there and you can consider it as risky trade because this bet is against the trend. As you know, markets move on the waves and we, as day traders, just try to catch those short-term waves - at the moment, I will try to catch a short-term wave upwards from the green box to the arrow peak.
The green box marks the reversal area, and the key is a candlestick pattern.
Since the end of November, the price has got one impulsive wave downwards and currently, the second impulse (current price action) can drag the price inside the green area, which also should work as a support level and actually, as said, I expect a short-term bounce from it also - it would be nice ;)
From the end of November, the price has started to take a direction downwards inside a parallel channel. As you know, if there is a certain direction/movement then pretty often the price moves inside the channels and pretty often they are parallel channels. So, if this time it starts to move inside the parallel channel then this green area would be a perfect spot to jump a bit higher, at least a tiny amount ~$300.
Okay, enough for this talky-talky bla-bla: the green area consists of:
1) The blue parallel channel, pulled from the wicks.
2) The black dotted parallel channel, pulled from the bodies - just in case because it removes a bit more market noise from the wicks but luckily, they match perfectly with the wick-channel inside the green area.
3) 2x AB=CD, as channels, blue is pulled from the wicks and black is pulled from bodies which means that it is dragged from closing prices on the 4H timeframe.
--- Both they make up a crossing area and it stays slightly below $7,900. So, it should be the strongest area on the chart and the price definitely needs to touch this before you start to search any bullish candlestick patterns (rushed a bit ahead with that ;)
4) The round number of $7,000 should act as a support or at least a psychological number.
5) Fibonacci retracement 62% is around the area to shuffle the cards a bit, it should also act as a support level.
6) Fibonacci Extension 127% matching perfectly with our channel and AB=CD crossing area
7) Weekly EMA100 is around the marked area.
8) And now the key point, as always, wait for a bullish candlestick formation. This time it can also appear on the 1H chart BUT as said, it needs to touch that mentioned crossing area. The crossing area and the strongest price level inside the green box should stay between $6,850 - $6,910. So, a bullish candlestick pattern after the touch or inside that mentioned price zone will finally trigger the trade!!! We are betting against the trend and if you don't wait for a bullish candlestick pattern, then most of the time you are a loser without any patience - rude but simple!
Do your own research and please, take a second and support my effort by hitting the "LIKE" button, it is my only FEE from You!
Best regards,
Vaido
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