Welcome pooplings, to this update analysis on Bitcoin! Let's get right to it! Looking at the four hour chart, you can see that despite the recent breakout, and all of the bullish moon and lambo talk, Bitcoin remains in a strong bear market downtrend. Each red arrow on the chart catches a series of reactionary highs, and they're all lower than the previous high. That is the definition of a downtrend, which we are obviously still in. Yes, we did have a rally, and yes, we did break out above the downtrend channel, but we're still in a crystal clear downtrend. Until that downtrend is broken, and BTC posts some higher highs, I have no interest in buying into this market. I'm not trying to capture every single percentage point movement that Bitcoin makes. My goal is to trade with the trend, while executing high probability of success trades, by finding optimal entry and exit points. With that said, I would much rather wait for selling opportunities to emerge, instead of FOMO buying into a lower high on Bitcoin. "Oh but Magic, you're missing the rally and blah blah blah." I really don't care what I miss. My goal is to find premium entry and exit points, and I do that quite well.
In the most recent action, Bitcoin has continued to consolidate after the big rally on 4/12. The most noteworthy development, is that BTC continues to find support on top of the 200 EMA (in purple.) To put that into perspective, BTC hasn't found support on the four hour 200 EMA since February. Here, there have been several attempts to break down below it, but each attempt has resulted in a hold of the 200. With that said, if the 200 EMA falls, we could see some accelerated selling as a result. So, that is a breakdown threshold that I am watching for a short entry.
Since BTC has broken out above the downtrend channel, and is now finding support on the 200 EMA, we could see a test of the 1200 EMA (in red,) which is equal to the 200 EMA on the daily chart. However, you can see that there is currently some resistance in the way, in the form of the falling black dotted trendline. BTC is currently testing that level, so it will be critical in determining the forward path from here. A breakout above the black dotted trendline could send BTC up to test the 1200 EMA, but a rejection could send BTC back to the 200 EMA, and potentially lower.
From my perspective I wouldn't want to be a buyer until a confirmed breakout above the 78.6% retrace, at about 9460. From a risk/reward perspective, there is far less overhead resistance there, and that would be a clear sign of a trend reversal in BTC. I don't care about how much BTC has moved in between here and there, or what has happened. I am concerned with finding high probability of success, low risk trades. Buying right now is not a low risk trade, because there is a slew of overhead resistance above us. Any one of those points, could be the place that BTC reverses back to the downside, and that has pretty much been true through the entire rally. That is not a condition that I want to buy into. I'm not a long term investor. I am a trader. And as such, I trade in and out of the market, when the conditions are favorable. Safe, buy side conditions are not favorable right now. Sure, we could plow through all of the overhead resistance, and blast off to the moon, but nobody knows if that will happen or not. NOBODY. So, from a buy side perspective, it's best to wait for safe buying conditions, which, in my opinion, exist above the 78.6% retrace.
Since we remain in the midst of a powerful bear market, I prefer to wait for selling opportunities, as opposed to buying opportunities, whenever they present themselves. The trend is your friend, and the trend is still down. I'm the master of the charts, the professor, the legend, the king, and I go by the name of Magic! Au revoir.
***This information is not a recommendation to buy or sell. It is to be used for educational purposes only.***
Have you ever heard the tale of the Institutional Whale???
As the story goes...
There's an institutional whale out there with a large green button that says, 'BUY MARKET'... He's only allowed to hit it when there are a ton of shorts to squeeze to help drive the price to his marked up value. He then dumps it on the market -- unleashing all sorts of fear and pandemonium.
He seems to come out when you least expect it. (Usually overnight NYC time, at least.) If you aren't careful and FOMO into your positions too quickly, he will eat you alive. Before you know it, your hopes of 'Going to the Moon' will cease and you will fear the markets; you will develop and Feds into market anxiety/uncertainty.
Here's how to beat him...
1st rule is patience. You have to patient enough to wait for the big moves to happen. Then you give it sometime for things to settle. When he shoots up/down another spike to retest the line of support/resistance, you pounce on him. Hold your ground!
2nd rule is do not overstay your welcome... The moment things start to move favorably, you must have your exit and stop-loss strategy in place. Identify the next level of support/resistance, and bail out. If you overstay your welcome, he will send his bot minions to 'seek and destroy' you by way of liquidation.
Your liquidation is the fuel he is after, and he will play all types of tricks (I.e. Fake-out H&S patterns) to shake you out.
Don't think for a second you are safe from this institutional whale. He knows all the books you read, all the Tradingview members you follow, and most importantly, he knows how to use your emotions against you.
Beware of the 'BOOGIE Whale'... Or else.
Cheers :)
TheCryptobaught
⋅
@dralerte, You are the fabled Institutional Whale, I can tell.
As the story goes...
There's an institutional whale out there with a large green button that says, 'BUY MARKET'... He's only allowed to hit it when there are a ton of shorts to squeeze to help drive the price to his marked up value. He then dumps it on the market -- unleashing all sorts of fear and pandemonium.
He seems to come out when you least expect it. (Usually overnight NYC time, at least.) If you aren't careful and FOMO into your positions too quickly, he will eat you alive. Before you know it, your hopes of 'Going to the Moon' will cease and you will fear the markets; you will develop and Feds into market anxiety/uncertainty.
Here's how to beat him...
1st rule is patience. You have to patient enough to wait for the big moves to happen. Then you give it sometime for things to settle. When he shoots up/down another spike to retest the line of support/resistance, you pounce on him. Hold your ground!
2nd rule is do not overstay your welcome... The moment things start to move favorably, you must have your exit and stop-loss strategy in place. Identify the next level of support/resistance, and bail out. If you overstay your welcome, he will send his bot minions to 'seek and destroy' you by way of liquidation.
Your liquidation is the fuel he is after, and he will play all types of tricks (I.e. Fake-out H&S patterns) to shake you out.
Don't think for a second you are safe from this institutional whale. He knows all the books you read, all the Tradingview members you follow, and most importantly, he knows how to use your emotions against you.
Beware of the 'BOOGIE Whale'... Or else.
Cheers :)