Taking a look at the Bitcoin daily chart, I cannot help but cringe at the picture I see. We had a very strong rally back to $50k after our 50% fall from the high at $65k. But you can see the price action rounding as it approaches the neckline of the previous high, which to me means the bulls are either exhausted or taking some time before moving on up. However, I think their is more evidence at the moment in support of a bearish reversal here. We have been rejected twice now by the $50k level which could potentially be a double top bearish pattern. You can also see the daily sell wick forming from yesterday's pump. I think if we fall back below the purple support area, we can confirm this was a bull trap and need to consider changing gears from bullish to bearish. The potential downside from here could be big and I will be taking the necessary precautions to protect my investments. Dropping to the $40k level could set up a massive head and shoulders pattern which would take us down to $16k-$18k. That is a worse case scenario, but a plausible one, especially considering Bitcoin's proclivity for dramatics.
In terms of the alt market, I don't think I will be making many shorts given how bullish they are against BTC. We could have a December 2017 - January 2018 flip between Bitcoin and the alts where the alts break their usual behavior pattern and follow Bitcoin's lead. If this is the case, I will be looking for ALT/USD entry points when Bitcoin hits its lows and hoping for strong alt spikes when it moves sideways. We will see. Stay tuned!
In terms of the alt market, I don't think I will be making many shorts given how bullish they are against BTC. We could have a December 2017 - January 2018 flip between Bitcoin and the alts where the alts break their usual behavior pattern and follow Bitcoin's lead. If this is the case, I will be looking for ALT/USD entry points when Bitcoin hits its lows and hoping for strong alt spikes when it moves sideways. We will see. Stay tuned!