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ChartCinema
Jan 14, 2024 12:29 AM

Bitcoin Wyckoff Distribution Returns 😱 Short

Bitcoin / United States DollarCoinbase

Description

After the Bitcoin ETF was approved there was a 2nd Upthrust After Distribution to test remaining demand.

🚨 Supply was dominant and within 24 hours it was a "buy the rumor, sell the news event."
🚨 Bitcoin re-entered the Wyckoff trading range.
🚨 A small bounce created a Last Point of Supply, which is the ideal entry for a short position.

Trade active

🚨 Bitcoin dropped below bottom of Trading Range to create a Sign of Weakness.
🚨 Bitcoin flipped the bottom of the Trading Range at $40,150 to resistance and created its final Last Point of Supply for shorts to enter.
🚨 Now entering Phase E: Supply in Control

Comment

Stop losses of short sellers were most likely taken out!

🚨 If 4-Hour candle body closes above the previous Last Point of Supply at $41,860 it would be a Change of Character and we would need to re-evaluate the Phase D where supply should be dominant.
🚨 BTC Combined Volume shows that the effort used to move price up is less than the result. So, this may be a bull trap before the weekend.
🚨 On Balance Volume does confirm the bullish reversal move... but it is far below the levels of the previous swing high, which also makes me suspect that this is a bull trap.
💡 Ultimately, price is king. Close the 4-Hour candle above $41,860 and maybe we accept a possible bullish reversal.

Comment

Demand has been dominating supply.

⭐ Price has moved above all Last Point of Supply levels creating a Change of Character. Therefore, one must accept that we could be in a bullish reversal.
🚨 Volume is conflicting with price. BTC combined volume shows little increase in effort used to produce the result of price moving up.

⛔ Going into a long position is difficult because volume is not consistent with price action.
⛔ Going into a short position doesn't make sense until there is a clear chart reversal pattern.

Comments
alluboy86
Market manipulation and short squeeze before dump to 35k zone.
day0
very nice
ChartCinema
@day0, Looks like Bitcoin made a bullish move, my latest update is in the comments above.
day0
@ChartCinema, Very tricky too, because past historical data points reflect this can go either way. So 'may be a bull trap before the weekend' is still very possible. My time-base analysis is set for 2024-02-01 at the very earliest and 2024-02-11 for bull is more likely. However, this is time-based only with less trend and more historical and time based measurements.
ChartCinema
@day0, time-base analysis that you do looks interesting. I just gave you a follow
day0
@ChartCinema, Thank you! I only can follow so many people and it says I have to remove one person. I may look for a dead account to remove to follow your analysis too. Yeah, I'm an economist and data scientist, so I like to look at time-based with the economics as outside variables mixed in.
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