BTC - Waiting on 2 plays (Mid quarter ABCD & 2 Quarter Triangle)
There are two plays I am waiting to see with BTC.
One a mid quarter ABCD Pattern I talked about a couple weeks ago where the recent 6.8k level (a) up to 11.8k (B) is now looking to retrace back down to point (c) at 7k. Currently BTC is testing the levels again. I will want to see a short - term bullish reversal to be comfortable entering the pattern. Typically I wait for a significant volume of 25k volume on the 2h chart with a break out of the pattern it is currently on. The target would be either retrace up to 11.7k or more cautiously mid way between C&D for a quick swing.
This is because a break past 9.5k would signal triangle pattern breakout from a much longer pattern in play, thus could be a large resistance that won't be overcome just yet. (maybe after tax season).
Unfortunately the short term trend lines I placed were broken last night and could be a signal for retracement to previous lows of 6k and even 5k as some analyst called last week.
The other play is alot longer in the making. A triangle pattern from the breakout back in November. If a reversal to test the 12k mark happens again, the buying pressure may be enough now to actually break this wall. Most exchanges are showing large buy walls. On gDAX I am seeing nearly 2k on the 7.5k, and even higher at 7.1k. a breakout past 9.5k on this pattern could be the signal we are looking for to test the previous resistance again (& hopefully break 12k finally).
I will concede though that a fake breakout occurred early feb. - a failed inverse H&S.
I'd be cautious if a break below 6.5k of this pattern occurs, which could indicate a break down to 4k (not alot of support or time was really spent trading at 6k). Especially if the 50EMA crosses over the 200EMA. Right now 50 & 100 EMA seems to like this dance, which is good for traders I suppose. I concede that this may be just patterns I am seeing and may even need to adjust to a larger pattern where point A could be at 3.5k, when the parabolic pattern started, and broke at 19.7k. As always these are just ideas in play. I still remain bullish with BTC but taking opportunities to grow both BTC and Fiat war chest.
From a macro stand point - Something I talked about a couple days ago in my group and seeing alot more attention on it in media is the the BTC dominance gaining traction. I used volume and the market cap levels / dominance before as signal for possible bullish or bearish indicators. There seems to be a larger and larger stake on BTC with a inverse relation to ALT dominance. Meaning that BTC is slowly gaining some dominance back, and taking larger volumes out from Altcoins. If you notice there is nearly double digit lost in Altcoin when a single digit lost in BTC valuation occurs. Subsequently, a bullish single digit gain on BTC valuation is met with minimal gain on ALT valuation. There are a few outlyers that is breaking this trend (i.e. IOTA; LTC& ETH (for a short period).
This also happened last year where ICOs dominated in May, which was part of the lead up from ETH gaining such a larger foothold in q2 of 2017. This could be BTC whales answering back to the idea of the "flippening" and securing its dominance as #1 coin.
I also see that there isn't really any bad news per say for BTC. Regulations are in play; which is more focused on ICOs and less so toward BTC and the larger cap coins. More banks seems to have larger holdings on these assets, so much so that they are even offering it to their clients. We will have to see where this goes. Mt. Gox seems to be more scrutinized to the point where the next sell off could be more controlled and may have little impact on the market (crossing finger they sell the asset off the market unlike this previous time in Dec /Jan). If you also notice CNBC and alot of "crypto" critiques are talking less about the technology component (i.e. slow transaction time, high fees, etc.). Seems like Lightnining network mainnet launch would be an excellent catalyst.
One a mid quarter ABCD Pattern I talked about a couple weeks ago where the recent 6.8k level (a) up to 11.8k (B) is now looking to retrace back down to point (c) at 7k. Currently BTC is testing the levels again. I will want to see a short - term bullish reversal to be comfortable entering the pattern. Typically I wait for a significant volume of 25k volume on the 2h chart with a break out of the pattern it is currently on. The target would be either retrace up to 11.7k or more cautiously mid way between C&D for a quick swing.
This is because a break past 9.5k would signal triangle pattern breakout from a much longer pattern in play, thus could be a large resistance that won't be overcome just yet. (maybe after tax season).
Unfortunately the short term trend lines I placed were broken last night and could be a signal for retracement to previous lows of 6k and even 5k as some analyst called last week.
The other play is alot longer in the making. A triangle pattern from the breakout back in November. If a reversal to test the 12k mark happens again, the buying pressure may be enough now to actually break this wall. Most exchanges are showing large buy walls. On gDAX I am seeing nearly 2k on the 7.5k, and even higher at 7.1k. a breakout past 9.5k on this pattern could be the signal we are looking for to test the previous resistance again (& hopefully break 12k finally).
I will concede though that a fake breakout occurred early feb. - a failed inverse H&S.
I'd be cautious if a break below 6.5k of this pattern occurs, which could indicate a break down to 4k (not alot of support or time was really spent trading at 6k). Especially if the 50EMA crosses over the 200EMA. Right now 50 & 100 EMA seems to like this dance, which is good for traders I suppose. I concede that this may be just patterns I am seeing and may even need to adjust to a larger pattern where point A could be at 3.5k, when the parabolic pattern started, and broke at 19.7k. As always these are just ideas in play. I still remain bullish with BTC but taking opportunities to grow both BTC and Fiat war chest.
From a macro stand point - Something I talked about a couple days ago in my group and seeing alot more attention on it in media is the the BTC dominance gaining traction. I used volume and the market cap levels / dominance before as signal for possible bullish or bearish indicators. There seems to be a larger and larger stake on BTC with a inverse relation to ALT dominance. Meaning that BTC is slowly gaining some dominance back, and taking larger volumes out from Altcoins. If you notice there is nearly double digit lost in Altcoin when a single digit lost in BTC valuation occurs. Subsequently, a bullish single digit gain on BTC valuation is met with minimal gain on ALT valuation. There are a few outlyers that is breaking this trend (i.e. IOTA; LTC& ETH (for a short period).
This also happened last year where ICOs dominated in May, which was part of the lead up from ETH gaining such a larger foothold in q2 of 2017. This could be BTC whales answering back to the idea of the "flippening" and securing its dominance as #1 coin.
I also see that there isn't really any bad news per say for BTC. Regulations are in play; which is more focused on ICOs and less so toward BTC and the larger cap coins. More banks seems to have larger holdings on these assets, so much so that they are even offering it to their clients. We will have to see where this goes. Mt. Gox seems to be more scrutinized to the point where the next sell off could be more controlled and may have little impact on the market (crossing finger they sell the asset off the market unlike this previous time in Dec /Jan). If you also notice CNBC and alot of "crypto" critiques are talking less about the technology component (i.e. slow transaction time, high fees, etc.). Seems like Lightnining network mainnet launch would be an excellent catalyst.