I have been listening and reading a lot of analysis and many bears are looking for more bad news. They expect more contagion from Three Arrows Capital, or from Celsius bankruptcy proceedings, another project to go bust like Luna, and quite frankly I think it doesn't matter.
Trading and investing is a practical application of psychology, both individual and mass. Part of this psychology is studying how information (price and price action) goes through the human network and how the sentiment of regarding price and price action changes. There is a world of difference in sentiment that occurred when bitcoins price action went from $200 to over $19,000 than when price action hit $19,000 again, this time by falling from $69,000
News can have a varied affect price depending on market phase. Bad news has a disproportionate effect on price in bear markets and good news has a dipropionate effect in bull markets. That is how sentiment and price work together. One way you can get a feel for markets pivoting subtly is when bad news no longer drives the bear market lower and good news no longer pumps the price. Why? It is how sentiment goes through a market and most of the people with money have already used it up.
In the bear case all the hot money is gone, the leverage has been squeezed out most of the weak hands have also left. What we have left are people with a longer time horizon that want to buy short term bad news due to a believer in long term gains. The liquidations show the weak hands and hot money getting crushed for being too optimistic.
Below is a version of a chart I have shared several times before. Price is deep below the weekly ichimoku cloud where most people are bearish. The On Balance Volume is way below the 100 SMA. These are areas where accumulation occur. SO far after every time bitcoin based with the OBV below the 100 the SMA we have formed a continuation pattern to the upside. Mostly a W.
When the volume has been driven down so low it has less ability to go lower. Most of the sellers that would have driven it lower have left. If you want more confirmation or momentum then you could wait to put your position on when the OBV gets back above the 100 SMA. I however, am building my position in alts that I think will have the most upside for a mutli year bull market like we had after 2015.
Trading and investing is a practical application of psychology, both individual and mass. Part of this psychology is studying how information (price and price action) goes through the human network and how the sentiment of regarding price and price action changes. There is a world of difference in sentiment that occurred when bitcoins price action went from $200 to over $19,000 than when price action hit $19,000 again, this time by falling from $69,000
News can have a varied affect price depending on market phase. Bad news has a disproportionate effect on price in bear markets and good news has a dipropionate effect in bull markets. That is how sentiment and price work together. One way you can get a feel for markets pivoting subtly is when bad news no longer drives the bear market lower and good news no longer pumps the price. Why? It is how sentiment goes through a market and most of the people with money have already used it up.
In the bear case all the hot money is gone, the leverage has been squeezed out most of the weak hands have also left. What we have left are people with a longer time horizon that want to buy short term bad news due to a believer in long term gains. The liquidations show the weak hands and hot money getting crushed for being too optimistic.
Below is a version of a chart I have shared several times before. Price is deep below the weekly ichimoku cloud where most people are bearish. The On Balance Volume is way below the 100 SMA. These are areas where accumulation occur. SO far after every time bitcoin based with the OBV below the 100 the SMA we have formed a continuation pattern to the upside. Mostly a W.
When the volume has been driven down so low it has less ability to go lower. Most of the sellers that would have driven it lower have left. If you want more confirmation or momentum then you could wait to put your position on when the OBV gets back above the 100 SMA. I however, am building my position in alts that I think will have the most upside for a mutli year bull market like we had after 2015.
And I promise every Floridian that you will all be rich... because we're gonna print some more money! Why didn't anybody ever think of this before?
~Nathan Explosion
~Nathan Explosion
