DIGITAL ALPHA UPDATE BTC - Summer is coming, will BTC heat up?
When I post I'll tend to only post if somebody asks me a question about the market or about a coin. This way I feel like I'm answering a few questions out in the social media abyss. So my boy "BM" had a question about why I thought this was a WXY pattern that we are in. So I outlined it in my previous post "BTC loves triangle dancing", link below. What I'm doing here is adding a long-term twist to that quick post. I want folks to understand how important this next sequence of events might be. I see several scenarios playing out and I will stay up to date on them within this post.
Before laying them out, you'll see my reversal WXY pattern above. It is made up of an ABC downtrend (with two 12345 waves) forming the "W", then the minor bounce to form the "X", then an accumulation pattern/ABCDE pattern to complete the "Y".
IF this plays out and we go north towards the blue dashed resistance, then we will start getting excited...meaning we 1) see BTC break right through 2) get rejected then breakthrough OR 3) get rejected big time. This last scenario is what we need to watch out for.
IF we get a big rejection and head South, I'll start praying for the blue dashed line that has been acting as a support to catch mr btc. If we do, we will probably go sideways alllllll summer long. Looking back at previous BTC double top patterns (read link below titled "Warning your head will explode" for more information) when we didn't go bullish after a triple bottom, we went sideways or south. If we bust downward through our blue dashed support then I'll enter "PANIC" mode. With the lack of liquidity in btc, low volume, and lack of confidence (since breaking triple bottom support), we will get into some very low territories...but let's not get into that yet.
So what are we looking for in order to break the blue dashed line. Pretty easy actually...during the rise if you see a major movement upwards in price when a good piece of news is published, get ready because the market is starting to turn into a bull. For now though, all good news as limited reaction to the market, which means I'll change my name momentarily...
Signing off,
DA Bear
Before laying them out, you'll see my reversal WXY pattern above. It is made up of an ABC downtrend (with two 12345 waves) forming the "W", then the minor bounce to form the "X", then an accumulation pattern/ABCDE pattern to complete the "Y".
IF this plays out and we go north towards the blue dashed resistance, then we will start getting excited...meaning we 1) see BTC break right through 2) get rejected then breakthrough OR 3) get rejected big time. This last scenario is what we need to watch out for.
IF we get a big rejection and head South, I'll start praying for the blue dashed line that has been acting as a support to catch mr btc. If we do, we will probably go sideways alllllll summer long. Looking back at previous BTC double top patterns (read link below titled "Warning your head will explode" for more information) when we didn't go bullish after a triple bottom, we went sideways or south. If we bust downward through our blue dashed support then I'll enter "PANIC" mode. With the lack of liquidity in btc, low volume, and lack of confidence (since breaking triple bottom support), we will get into some very low territories...but let's not get into that yet.
So what are we looking for in order to break the blue dashed line. Pretty easy actually...during the rise if you see a major movement upwards in price when a good piece of news is published, get ready because the market is starting to turn into a bull. For now though, all good news as limited reaction to the market, which means I'll change my name momentarily...
Signing off,
DA Bear
Comment:
On a larger time-scale we can see this pattern...again...and it fits our above scenario. However, this means we would follow the red line and the "be prepared for a long summer of sideways" path. To me, this is the most likely scenario after looking at this E.W. pattern on a larger time-scale. So take a look! Thanks, please share and give me a thumbs up if you liked the content.
Comment:
I have gotten some questions on where that dump came from. Remember, we are all subject to market participants and incentives. Whenever there is an incentive to make a quick buck, there will be actors that attempt to capitalize. With the movement here within the accumulation stage (and low volume), many longs were opened up compared to shorts. Therefore if one had a big enough bag, one could move the price down to certain levels. Opening up a short position with high leverage would be where the profit was made...quickly. You can see what happened during the dump with this photo: prnt.sc/jtaqtv
Bitmex is known for Market Makers and there is a great medium post that discusses this, realize that this does influence price like this. Normally shrimps do not have access to this type of information and cannot see when longs vs shorts are lopsided. The chart for Bitfinex is not helpful since the leverage is so low compared to the 100x leverage on Bitmex. Interestingly enough, we found solid support on the blue hashed support, again. Trade is still active.
Bitmex is known for Market Makers and there is a great medium post that discusses this, realize that this does influence price like this. Normally shrimps do not have access to this type of information and cannot see when longs vs shorts are lopsided. The chart for Bitfinex is not helpful since the leverage is so low compared to the 100x leverage on Bitmex. Interestingly enough, we found solid support on the blue hashed support, again. Trade is still active.
Order cancelled:
buying triple bottom here. This pattern is null and void now...
