CRInvestor
Short

Fail at bearish Gartley Pt. D suggests short

BITFINEX:BTCUSD   Bitcoin / Dollar
hello all,
Bitcoin's dead cat bounce off the key 4hr 38.2 Fib tag (582.37) has played itself out. If that low does indeed prove to be 'the low' that will bode well for BTC             going forward ( bullish reversals off 38.2 tags are indicative of a strong market). Additionally, higher time frame analysis suggested we needed to work through a correction-time-window that ought to take us into this week and that has played out as anticipated. The question now is, do we break out of the current trading range in a massive bullish rally or take one more tank lower into higher time frame OTE             zones? The answer to that is still elusive at the moment but considering the Silk Road auction is looming it shouldn't surprise anyone to see breakout attempts fail ahead of that event.

So looking at the chart this morning (7AM pst) it was not surprising to see a short setup has developed over the past couple of days. Indeed, the counter trend rally off the 38.2 Fib has set up a very interesting bearish Gartley harmonic price pattern. I Tweeted last night that a fail at that level may set up a juicy short and now I see a double top has developed off that exact level. As confirmation of the idea, Willy himself is still quite ill and in the process of cleaning himself up and our raw momentum reading ( MACD histogram) has registered a double top at these levels too. While volume flow is still positive, I do see our latest big bar was red and OBV itself is teetering. Put it all together and it looks like we may need to test the lower end of our recent trading range before any move higher can begin in earnest.

So that brings us to the trade. I like the idea of shorting on fail of the last candle bar's low 602.34 with stops at new highs (just above 619.60) and a target of both the OTE             (Long) sweet spot 550.90 and the very noticeable gaps down to 553,23. This represents a little more than 3:1 potential reward to risk and a ratio I like. While there are no guarantees with setups (and my CME buddies are more than content with 60% long term accuracy) this feels like a setup worth taking. Sadly, due to lack of funds, my account is unable to take the trade; but I sincerely hope those out there that can take the risk ought to seriously give this setup some consideration - or at least learn from it.

Cheers all and hope it helps

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Your forecast played out very well!
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This was a good one and I actually understood about half of it. I'm still novice to intermediate with TA. What is OTE and OBV? Or were is a good site to read more about these and another key acronyms? I'm about to send you a donation and thanks for sharing these with us.
+1 Reply
CRInvestor PRO btctrader99
OTE: is a fib term (Optimal Trade Entry) and is the 61.8 to 78.6 retracement level. here is a tutorial I wrote on using Fibs: https://docs.google.com/presentation/d/1_FAf5ta95HlLndv6BLaW5wpp-8aDJEBEmqEAGFO40E4/edit?usp=sharing and here is a YouTube video I did on the tutorial info: :

OBV: is a volume indicator I use (On Balance Volume) and here a tutorial I wrote on using volume indicators: https://docs.google.com/presentation/d/1zyvKRo0nVXAHHSTKS9qKilgJVTwnC04i8p1uwqx-qG4/edit?usp=sharing and here is a YouTube video I did on the tutorial info: https://www.youtube.com/watch?v=0f9tXq7Gdo8&index=4&list=PLBQfICzKWV2K2MQOgeX9ssk69W1mgnxuW

cheers,

Brian
+4 Reply
primaindustria btctrader99
If you are new, then you have found the person whose material you need to be studying. Study and re-study all of Brian's material. It is a wealth of knowledge and it's all free! Also be sure to check out his YouTube channel. If you learn anything, which you should, you should really think about sending him some compensation in the form of BTC.
+2 Reply
CRInvestor PRO primaindustria
aww, now you are going to make me blush...teehee...ty sir
+1 Reply
btctrader99 primaindustria
Yes I am trying to learn more. I think i could really increase the winning % of my trades with a little more discipline and study. I am following CRInvestor now and already sent a donation and will be happy to send more in the future when I get even more value out of his posts.
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new to trading btc, but not new to the world of fx. cheers for this.
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man, you are gonna luv BTC's harmonics....its a thing of beauty
+1 Reply
lukas.o.chudy CRInvestor
is there any harmonic pattern supporting your target placement? or you will adjust target later after some future action?
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CRInvestor PRO lukas.o.chudy
61.8 to 78.5 fibs is harmonics in itself
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