We recently saw the price correction that I was waiting for since February, but the price of Bitcoin kept on growing, mainly due to the investment craze we're experiencing and of course Elon Musk dragging retail investors/ gamblers into the market. The downwards move of the previous two days was caused by bad news coming from China in terms of restriction & regulation, as well as some other small factors that highlighted the vulnerability of the crypto-market these days. Various exchanges such as Coinbase & Binance struggled to keep up with the high volume and some trades were basically not executable yesterday. There are fears and questions coming up, triggering this trend-change that we can observe on the daily chart.
From a technical point of view, the Bitcoin price gave us the first hint of a trend-change with a lower high on May 10th, followed by a strong drop towards the previous low. Tesla backed up from accepting Bitcoin as a payment method because of the "environmental issues" that mining cryptocurrencies causes. I personally think that Elon was pressured to do this. They are still holding the Bitcoins they bought a few months ago, which is contradictory to the news we saw. Nonetheless, the market reacted with fear and many people took their profit. This scenario basically confirmed the trend-change from a fundamental side and that's where we have to re-evaluate our trading strategy.
It is very important to differentiate between investing and trading cryptocurrencies. If you are in for the mid- and long-term, don't worry about what's going on. The price will recover from this. If you are actively trading the market, you need to change your perspective on the market and trade with the trend. Everything else will result in panic buying or selling. Stick to a plan until you see another sign of a trend-change (in this case from a downtrend to an uptrend).
Therefore, I'm placing my orders for a short position at the previous high, which should act as a strong supply zone for those who are fearful and want to quit their positions. There's no trading opportunity in between - so we have to be patient. I'm expecting the price to move back to the supply zone within the next 3-4 days. The $50.000 level should also act as psychological resistance, such as the $30.000 proved its importance yesterday. My target is located at the demand zone with a gross profit of ~30% (not leveraged).
The emotions & expectations on the market can basically change at any moment. This idea is based on the primary trend, that we can observe on the monthly and weekly chart. I'm personally expecting more bad news to come up and more panic across the market. A confident close on the weekly above the $52.000 level would confirm a continuation of the upwards trend.
Hit "Play" button and is Spot ON.
Good show old bean.