My recent articles for weeks have been talking about two scenarios: 1) retrace to the 3500 area OR 2) Break out and look for momentum continuation. We don't pretend like the marketers do, instead we follow best practices and WAIT for the market to choose, and boy did it choose. The 4K was cleared, and so was the 4500 area resistance, and even the 5K psychological resistance all in about 30 minutes. Now that's decisive confirmation.
Based on our strategy, this market is no longer range bound and is NOW . As for swing trades, we look for momentum continuation patterns to get long. This means we now WAIT for price to retrace to the 4300 or 4150 areas which are the old resistance / new support levels in play.
As far as profit targets, this move highlights the 5K psychological resistance which price retreated from, AND the 5245 to 5812 (.618 area relative to the 6K high). Just like the 4150 area used to be, these new levels are where we will aim to lock in profits and measure reward/risk from after a new swing trade signal appears.
This surprise move also reinforces a very important lesson that many new traders completely miss. There is very little you can do to catch a 1000 point move in 30 minutes, EVEN if you are watching it unfold. It also looks easy after the fact, but anyone that has more than a couple of years of experience can tell you otherwise. This is why it is so important to employ MULTIPLE strategies. We don't just swing trade, because WE KNOW the limitations, we also carry inventory and have carefully cost averaged into a position with a cost basis of around 4300. All while being criticized and ridiculed when Bitcoin was pushing lows. Our performance record speaks for itself, and it has less to do with reading charts and MORE to do with patience.
In summary, after a long and tedious grind, Bitcoin has broken out of it range bound situation and is poised to usher in the next bull market. We don't get excited or emotional OR buy more at the highs. We continue to do what we have been doing the whole time: focusing on higher probability setups rather than HOPING FOR HOME RUNS. While the gamblers were getting faked out or squeezed, we waited patiently for the market to provide clarity. Here it is, and we have a healthy capital base to work from.