I also discussed a little something I've learned with the indicators in the 12-Day TF in order to help others potentially avoid the same mistake I made in regard to WHEN a bottom is potentially found and we begin to see reversal to the upside. I'll follow up with more updates soon. I'm about to get some coffee and work on a video publication for ETH.
Happy Trading and Stay Awesome!
David
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A look at the POTENTIAL trading range for a little while:
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If you use the indicators I use and you are curious as to which time frames are used for different TYPES of trading, I created a post in that regard on bitcointalk. When you click the link, you need to WAIT for the page to load in order for it to finally navigate to the correct post. If you immediately try to scroll down once you click the link, you will be forced to scroll further down the page to look for it. So, if you simply wait for the page to load, it will get you to the correct post I'm referring to. It's the LONGEST POST on that page. bitcointalk.org/index.php?topic=5140701.msg52252434
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WOW... Margin Shorts were DESTROYED on BitFinex. Never seen this much of spread between the margin short and long positions on BitFinex.
BTCUSD (Top); BTCUSD Short Contracts (Middle); BTCUSD Long Contracts (Bottom):
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Have a look at November 1, 2015 through May 18, 2016. NOTE the first initial pump up to the HUGE wick in the 2-Day TF on November 1st. It was so overbought, it was only natural for the price action to fall back down to where it did. HOWEVER, it was also natural for the price to come back up the way it did to find actual support within a trading range of $365 to $465. I'm anticipating similar present day; in which the price action falls down relatively low after a HUGE short term pump by turning back up to SETTLE within the trading range I previously highlighted from $9,350 to $10,800.
Here's November, 2015 to May, 2016 as an example:
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I'm creating a publication for the following chart again for some who are still confused about where we are within a Wyckoff Accumulation Schematic.
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Added a bit more to the chart. This forced me to reduce the font size... Sorry...
The Daily (24h) is currently looking like we could see another episode of upward pressure. This does not necessarily equate to upward price movement; although it is certainly possible. It could only mean the price is held up a bit longer until October 30th or 31st.
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Excuse me... I thought that was the Daily. When in fact it is the 6h (360 minute). My bad...
I am trying to get in the head of this so-called "composite man" to think what "he" would be thinking. I was aware that there was a large amount of longs already relative to shorts so it would be natural that "he" would have liked them shot down by pulling the price as low as possible to shake them out. But then again, there are also large amount of longs waiting to get filled at lower prices. The question must be until how low do they pull this thing down would they extinguish the most longs without filling too many of the standing long orders? The price point at which the amount of longs that would have gotten in exceeding the amount of longs they would have liquidated/shaked out, is the price point at which they would stop dumping. It was curious to me how BTC dumped nearly to 0.618 retracement level without touching it ($50 away on major exchanges), where substantial amount of longs would have been waiting to be filled.
So it pumped, unnaturally so, maybe thanks to Xi jinping's endorsement speech of blockchain, all the way through $10,000, and I noticed how the longs on bitfinex substantially increased the moment it broke through. There must have been large amount of longs waiting to be triggered once the resistance was broken. Thereupon, right on cue, the price dumped back to $9600 (eventually to daily 200MA ($8920)) and got all of them liquidated/shaked out the next one-hour candle. They all happened for a reason.
The amount of liquidations compiled the last few days may be likened to a mountain of skulls after a massacre. Imagine the amount of social tragedies created by this thing called the stock market. Whoever wins, the "composite man" wins.
WyckoffMode
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@popovichian,
Some find or create a chart to conform to their Fundamental Analysis (FA) obtained from news. I perform my Technical Analysis (TA) with NO regard to news. It seems every time we have a decent amount of movement in the crypto market, the news organizations have to look for some news to try to explain WHY the price moved the way it did. I use indicators to explain how and why the price action has moved or will move in the future.
As for BitFinex long and short contracts, I believe those contracts are fake; just like much of the news. I do not believe the long contracts they have posted are real.
SocialCryptopreneur
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@WyckoffMode - Really like your thinking here. This time frame looks very similar to what appears to be happening at the moment. A big run up followed by a near collapse to retest the previous double-tops from January & July 2015. I am trying to make out the price point that we could revisit on the low side - could it be 8200ish? Lower? Higher? Look forward to your thoughts...
Actually, when I provided the November, 2015 to May, 2016 scenario, it was only to provide a scenario for something "similar" to potentially play out. Does not mean it would play out exactly. The circumstances today are a bit different from back then. We had much more "supply" back then than we do now. Less people willing to sell now than back then; simply Because the value of Bitcoin is much higher now than back then. The main thing I wanted to point out was how the price EVENTUALLY maneuvered back up higher to the more sensible trading range AFTER a rather significant pullback. We had a rather significant pullback of over $1,000 from the $10,350 top. Now it wants to gravitate back upward to more meaningful support with less concern of "supply" pushing us back down. The "effect" of the price action going up so fast "caused" the price action to fall back down rather dramatically. However, the "affect" of the price action going up so fast ALSO "caused" the "supply" of bear coins to dump on the market to diminish in supply. This "affect" has created the "cause" for the price action to remain at a higher trading range than previous with less concern of a significant drop due to "supply." This is not to say there is no chance of a significant drop. It's simply to point out the likelihood of that occurring is diminished if we were to take into account all the "supply" that has gotten us to where we are today.
SocialCryptopreneur
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@WyckoffMode, Have taken some time over the last couple of days to look at the candle pattern and review similar candle patterns in the past. I have found two over the past couple of years with a similar 1W candle pattern, at least to my eye on Kraken. Up-move just prior to the BCH launch in 2017, followed by the drop to 1800, before the big push, and 2) the bounce in February 2019 just prior to the collapse down to 5920. I realize this situation is “different” from the standpoint of Wyckoff Accumulation than either of these, but the candlestick pattern is quite similar - a weekly candle with big, roughly equally-sized wicks on either end. I imagine the next couple of weekly candles, following the monthly close on Thursday of this week, will give us some more information. Really do appreciate your analysis and thought-processes. You are clearly a student of the market and look closely at the historical context. Shorts have jumped back up on Bitfinex, with this weekly close looking to fall below the Triangle bottom, the channel, and below the .382 overall. I realize supply is definitely in a different position, and we might see more hodling occurring at this moment in anticipation of the Halving. I like your levels for now; but, I cannot ignore this nagging feeling that we have yet another shakeout lying ahead of us. Stay Awesome!!
Popovich
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@SocialCryptopreneur, I have that feeling of an imminent shakeout/correction as well, based on the godmode indicator from 1D to 5D, all of which overbought and many above 100 level, thanks to the $3000 pump in 2 days. The compass timeframe in medium term for me, the weekly TF, has white energy above 80, way ahead of the blue LSMA. At least when I look at the 2D, 1D, and 12H, I am wondering how much more pressure it has going up without a healthy retracement, given that 5-7 days white energy aren't just starting to turn up, they appear to be near exhaustion point as well.
From an elliot wave point of view, I am wondering if we are at the B point (freshly rejected at fib $9950) of an ABC correction.
SocialCryptopreneur
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@Popovich, Thank you for your input. I have been doing some calculations, just basic math, that we have between 35K - 45K more BTC to enter the market with each block between now and the Halving. At current prices, this is another $3.5 - $4.5 billion USD to enter the market. I know this may not seem like a big supply, given that it represents about 2% of the overall current supply, but it is still something to consider - that BTC has to cover some bills for some miners at some point. I try to keep these fundamentals in mind even when I am looking at the charts. With the Volume profile and the candlestick pattern as well as the possible ABC correction that you point out here, I am still considering that there may be some downside risk here that is not being taken into consideration. We shall see.
yololife96
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Hi, do you think gold is breaking out or more downside to go?
I'll work on an XAUUSD publication this weekend before the gold market opens again.
Anpu
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Great review David!
This is my idea about Bitcoin. RSI produced a bearish signal, but there is a risk to take it, because of a candlestick with the most buying pressure. This candlestick might form strong support for the price, and even reverse the local trend. There is even an option of a reverse of the Mid Term trend. For this option we need to see the price break through several strong resistances. (I gave them in my idea). Risky environment.
Please share your thoughts on this
So it pumped, unnaturally so, maybe thanks to Xi jinping's endorsement speech of blockchain, all the way through $10,000, and I noticed how the longs on bitfinex substantially increased the moment it broke through. There must have been large amount of longs waiting to be triggered once the resistance was broken. Thereupon, right on cue, the price dumped back to $9600 (eventually to daily 200MA ($8920)) and got all of them liquidated/shaked out the next one-hour candle. They all happened for a reason.
The amount of liquidations compiled the last few days may be likened to a mountain of skulls after a massacre. Imagine the amount of social tragedies created by this thing called the stock market. Whoever wins, the "composite man" wins.