Continuation on Bitcoin or first some retracement -> altseason?
New weekly write-up on the perspectives regarding Bitcoin.
Let's first start off with a small summary of what happened in the past week. Bias was pretty much bearish when we were hanging around at $4,200, which you can see in the past posts I've made. I was short on that position, however when we dropped down on the rising wedge and kept the channel in place, the bias switched to neutral (checked last post) and the shorts were closed. Went long on some alt pairs as these were looking beautiful.
Bitcoin ended up with a massive breakout upwards. Great for the market, great for the sentiment and great for the vibe in the community, obviously quite happy with that.
We did break two downtrends, which in general is key for me to think of bearmarkets coming to an 'end'. Will this mean that the bearmarket has ended? Most likely it is, however a retest of the lows is still likely for a 'spring' or range low test. Does it mean that you have to FOMO buy at $5,000? Nah. You don't have to. There's always a second chance in trading and when you didn't want to buy Bitcoin at $3,100 anticipating a further crash, it's adviced to review your own strategy, as we've seen some beautiful bulldivs there showing a push upwards already. If you started shorting in that area, that's also an advice to review your own strategy.
So, what is the game right now?
I'm short term quite neutral on the market. I'm pretty confident we'll see the upper old support as a test in the coming month to see whether we can confirm that as resistance. In the previous bearmarket and in general on bearmarkets it's common that previous supports are tested as resistance. So, in that light I'm expecting a continuation upwards to the $5,800-6,200 area.
However, currently I'm quite neutral back again. The gameplan is quite easy.
Scenario 1 - Retrace towards the $4,700 (200MA on Daily timeframe) or $4,400-4,200 area, which would be quite healthy for the market and also gives space to the alts to start rallying again. Normal to be seen after such a big impulsive move is to see the market calming down, volatility going away, volume going away -> Great for alts. In general (broader market perspective) I'm thinking that alts are ahead of Bitcoin and might not see new lows again, some of them.
What is the gameplan in this scenario? Definitely not shorting in this zone, quite foolish. I'm looking for a bullish continuation pattern ending at the $4,700 or $4,400 level for a long entry. I'd prefer to see a short term retrace towards $4,700 and continuation towards $5,700-6,200 afterwards instead of $4,200 already. I'd like to see $4,200 to become the new support after $6,200 for continuation, but that's me.
Scenario 2 - We range here and will move upwards to $5,800. I'm not expecting that $5,800 is the level we'll be bouncing of at this point. It's a one time touch from before, the main old support is around $6,200 and expecting that we'll be trapping in to that range to squeeze some limit buys before reversing. Breaking the '$5,800' would be critical for retail traders to step in. Will we clearly make a candle close above this range, a re-entry is obviously a long entry, but at this point I'm not expecting it.
So, if we range upwards from here, I'm looking for shorts in the upper zone.
Overall, I'm expecting calmth on the majors at this point and not particularly expecting to see movements upwards. Probably later in the month. This will generally end up with alts to be pushing up quite hard. Some of them look beautiful -> WAN, NEBL, HOT and more.
Thanks for reading, will be back next week!
Let's first start off with a small summary of what happened in the past week. Bias was pretty much bearish when we were hanging around at $4,200, which you can see in the past posts I've made. I was short on that position, however when we dropped down on the rising wedge and kept the channel in place, the bias switched to neutral (checked last post) and the shorts were closed. Went long on some alt pairs as these were looking beautiful.
Bitcoin ended up with a massive breakout upwards. Great for the market, great for the sentiment and great for the vibe in the community, obviously quite happy with that.
We did break two downtrends, which in general is key for me to think of bearmarkets coming to an 'end'. Will this mean that the bearmarket has ended? Most likely it is, however a retest of the lows is still likely for a 'spring' or range low test. Does it mean that you have to FOMO buy at $5,000? Nah. You don't have to. There's always a second chance in trading and when you didn't want to buy Bitcoin at $3,100 anticipating a further crash, it's adviced to review your own strategy, as we've seen some beautiful bulldivs there showing a push upwards already. If you started shorting in that area, that's also an advice to review your own strategy.
So, what is the game right now?
I'm short term quite neutral on the market. I'm pretty confident we'll see the upper old support as a test in the coming month to see whether we can confirm that as resistance. In the previous bearmarket and in general on bearmarkets it's common that previous supports are tested as resistance. So, in that light I'm expecting a continuation upwards to the $5,800-6,200 area.
However, currently I'm quite neutral back again. The gameplan is quite easy.
Scenario 1 - Retrace towards the $4,700 (200MA on Daily timeframe) or $4,400-4,200 area, which would be quite healthy for the market and also gives space to the alts to start rallying again. Normal to be seen after such a big impulsive move is to see the market calming down, volatility going away, volume going away -> Great for alts. In general (broader market perspective) I'm thinking that alts are ahead of Bitcoin and might not see new lows again, some of them.
What is the gameplan in this scenario? Definitely not shorting in this zone, quite foolish. I'm looking for a bullish continuation pattern ending at the $4,700 or $4,400 level for a long entry. I'd prefer to see a short term retrace towards $4,700 and continuation towards $5,700-6,200 afterwards instead of $4,200 already. I'd like to see $4,200 to become the new support after $6,200 for continuation, but that's me.
Scenario 2 - We range here and will move upwards to $5,800. I'm not expecting that $5,800 is the level we'll be bouncing of at this point. It's a one time touch from before, the main old support is around $6,200 and expecting that we'll be trapping in to that range to squeeze some limit buys before reversing. Breaking the '$5,800' would be critical for retail traders to step in. Will we clearly make a candle close above this range, a re-entry is obviously a long entry, but at this point I'm not expecting it.
So, if we range upwards from here, I'm looking for shorts in the upper zone.
Overall, I'm expecting calmth on the majors at this point and not particularly expecting to see movements upwards. Probably later in the month. This will generally end up with alts to be pushing up quite hard. Some of them look beautiful -> WAN, NEBL, HOT and more.
Thanks for reading, will be back next week!