Over the past couple days we have been examining the short selling volume as it relates to the price of Bitcoin. I noted that the shorts had fallen off drastically while the price had remained flat/fallen slightly. That told me that the only buyers above $5,900 were short sellers taking profit or getting liquidated.
On day 122 I wrote:
“I am expecting the shorts to continue to decrease down to 22,765, which is where I have drawn the white horizontal line to illustrate support. From there I am expecting a sharp reversal in short sellers and another drawdown in Bitcoin”
The rebound in short sellers led to the lowest daily close since 11/12/2017. That is when I expected to see selling volume increase significantly. Instead we are consolidating into a bear flag (red) at support (white).
The measured move for the flag is $5,590 and it would confirm with a breakdown below $5,882.
If we bounce from here then I am expecting prior support to turn into resistance at or below $6,072.
The stop losses on my short positions have been adjusted based on the Bill Williams Fractals from the daily chart. Those have been move to:
BTC: $6,378
ETH: $451
If you are not in a position then you have a couple options:
(1) You could wait for confirmation of the bear flag from above and enter upon a breakdown of support. The stop loss for that trade would be the top of the flag at $5,943.
(2) Or you can remain on the sidelines in order to start preparing for the next bounce.
BTC
ETH
LTC
I currently have orders to buy LTC at $61.75 | $55.51 | $49.76 | $33.60
I think LTC is the best option for a couple reasons: it has been oversold more than the other two and it offers a better potential ROI at approximately 100%. BTC and ETH would have a target closer to the 50% range.
$50 is also a very strong area of support for LTC. Bitcoin would need to fall to $4,000 - $4,200 and Eth $290 - $305 to reach the same levels of support.
Thank you for reading! Have something to say? Leave a comment! Click the follow so that you don’t miss out on future updates and remember that smashing the like is good karma!
On day 122 I wrote:
“I am expecting the shorts to continue to decrease down to 22,765, which is where I have drawn the white horizontal line to illustrate support. From there I am expecting a sharp reversal in short sellers and another drawdown in Bitcoin”
The rebound in short sellers led to the lowest daily close since 11/12/2017. That is when I expected to see selling volume increase significantly. Instead we are consolidating into a bear flag (red) at support (white).
The measured move for the flag is $5,590 and it would confirm with a breakdown below $5,882.
If we bounce from here then I am expecting prior support to turn into resistance at or below $6,072.
The stop losses on my short positions have been adjusted based on the Bill Williams Fractals from the daily chart. Those have been move to:
BTC: $6,378
ETH: $451
If you are not in a position then you have a couple options:
(1) You could wait for confirmation of the bear flag from above and enter upon a breakdown of support. The stop loss for that trade would be the top of the flag at $5,943.
(2) Or you can remain on the sidelines in order to start preparing for the next bounce.
BTC
ETH
LTC
I currently have orders to buy LTC at $61.75 | $55.51 | $49.76 | $33.60
I think LTC is the best option for a couple reasons: it has been oversold more than the other two and it offers a better potential ROI at approximately 100%. BTC and ETH would have a target closer to the 50% range.
$50 is also a very strong area of support for LTC. Bitcoin would need to fall to $4,000 - $4,200 and Eth $290 - $305 to reach the same levels of support.
Thank you for reading! Have something to say? Leave a comment! Click the follow so that you don’t miss out on future updates and remember that smashing the like is good karma!
Comment:
Added to short at current resistance cluster. Stop loss remains at $6,378 and the profit target is $4,950. Great risk:reward!
emasar Indicator is available for purchase at alphanalysis.io/product/emasar/