is painting a bull trap short term. Be careful; I wouldn't ape in yet. I still see BTC
going down to 36000, this one was a very small retracement, and as you know, if you have to study EW rules, every impulsive wave is followed by a corrective wave (retracement). It could be simple or complex. I believe we are seeing a simple ABC
correction. I see this last ride to 41k
as a wave B (exactly 0.7 of wave A, typical retracement for flat formations). We are missing wave C which usually projects us below the starting point of wave B, a target between 36 k and 35500. Let's analyse this ride... BTC
painted a few long shadows candle at the top. Also, there was a solid green candle on the way up with a very high volume
. However, the candle that followed close higher with a really low volume
which suggests there was a lot of selling volume
in the big green candle. Now, these few signs make me really cautious about jumping in. Also, looking at the indicators, many of them are overbought on short term timeframes. I do honestly believe this is a bull trap, price will be driven down to 36 k people who bought now will sell their bags which will be picked up from smart money for the ride at 54 k. BTC
is at a strong resistance as you can see by the previous volume
in this area (massive volume
) which suggest us a lot of people sold, but more importantly, bought, so now previous buyers are breaking even and selling creating a strong resistance. Also if we look at the chart it makes sense with this blowout BTC
will create a falling wedge
which is a bullish pattern
also common in a corrective wave. These are my thoughts short term. I have freed some profit yesterday and I am waiting for a better entry. We all feel the need to jump in and we are FOMO, but always be logical and wait for an entry that has a strategy and makes sense (the risk-reward ratio). However just want to point out we are painting a golden cross on the hourly which is bullish
, so we will see how this play out, sidelines are safer right now. I will look into get in on a clean break out of the 42500 levels (daily).
Do always your own research as this is only educational.
Let me know your opinions.