Why am I sharing this ? It's not about trying to spread a FUD but I believe in this volatile market of cryptocurrencies, the one that would strife is the one that able to prepare for the worst and act accordingly. Once you succeed to adapt with this approach, you'll be always avoid crisis and experiencing good moments. From my observations, a lot of analysis that already predict the bitcoin price will touch around 7k USD. But, whether the writer or readers aware or not many of em seems confident even over confident that this level will gonna be the bottom and the price will start mooning up immediately.
The big question is, what if 7k is not the bottom. What is your trading plan ? How do you mitigate the potential risk / loss on your portfolio ? Do you have any back-up trading plan ? Don't say you'll Hodl. Hodl only good when we know and confident with the fundamental of the coin yet have a certain target price on long-term base on TA.
So let's jump in with the analysis. First of all, we need to be able to point the motive / impulse wave. Although pointing still often debatable (especially if you also referring with the congruence of minor / smaller degree wave), but after I exam from the early 2017. This is the most potential impulse wave that I analyze. With 16-07-17 (1.925 USD) as the starting and 17-12-17 (19.891 USD) as the end.
Now I want you to pay a bit attention from the corrective wave . As you can see, the ATH bitcoin that drops significantly to 6k USD potentially were only be drawn inside wave A line. Although the drop is around 70%, but if you could re-check from the rules. The end of wave A corrections is usually near at the bottom of wave 4. Yet after that, the price gains decent reversal and form the wave B.
So if this truly be the valid wave in the market. Currently we're on the progress of riding wave C. What concerns me is, that wave C has the potential of ending the correction near at the top of wave 1 which is around 5k USD or 1,618 from Fibonacci which is around 2.420 USD. With not much to say, my advice for y'all is :
1. 7k USD is an attractive level to enter the market but it may not be a good entry. A good entry is the price that was lower than your exit price, as simple as that. Just like on any sport, the winner decide by the point not by the fairness, pretty performance (total football, tiki-taka, etc).
2. Don't enter with fully loaded yet, spare some for anticipating out of plan.
3. Set stop-loss if the support line confirm breached.
If you manage to read till the end, thank you. Have a safe and profitable trading. Cheers