The 41K resistance level has been taken out, but has not been cleared. It is possible that Bitcoin is still stuck within the 41K to 30K consolidation. The question is: do we get momentum follow through?
Often when price rejects a support or resistance level, it unfolds quickly. Bitcoin lingered around the high 30s, tried to pullback, only to be followed by an engulfing candle. This is a clear sign of strength which we have to assign greater weight UNTIL price proves otherwise.
The bullish scenario: next couple of candles are inside bars or dojis. The indecisiveness around a significant resistance level can culminate into a momentum continuation pattern. If the 42K area is cleared, the next key resistance is around 50K. Bitcoin is NOT out of the broader Wave 4 consolidation which means many false starts and false breakouts are HIGHLY likely in contrast to a full out bullish trend. Do NOT be suckered into over exaggerated claims "100K BTC" etc.
Risk on the swing trade time frame can be defined from the 35K level. If longs are taken in anticipation of the momentum follow through, keep in mind R:R is realistic around 1:1 or slightly higher from current levels. This is not the best location for a new swing trade. Better for lower expectation day trades.
The bearish scenario: price rejects the 41K area over the NEXT candle. Like I said, rejection should occur relatively quickly. If you are open to shorting (We ARE NOT), this would be a more appropriate location (compared to 30K). The thing is the stop must be no higher than 43K for swing trades. A decisive close above 42K and price can move much higher. If the bearish rejection unfolds, 35K is a reasonable profit area, NOT 30K. Bitcoin is NOT in a broader bearish trend. so expectations on the bear side should be very conservative.
Avoid getting stuck in an opinion, and do NOT get mixed up by the opinions of others. If you don't have a clear strategy or plan, you can only win randomly. Focus on defining your plan and keep it as simple as possible. In this game, it is more effective to make decisions with LESS information. LESS IS MORE.
Thank you for considering my perspective and analysis. I hope you find it helpful.
Often when price rejects a support or resistance level, it unfolds quickly. Bitcoin lingered around the high 30s, tried to pullback, only to be followed by an engulfing candle. This is a clear sign of strength which we have to assign greater weight UNTIL price proves otherwise.
The bullish scenario: next couple of candles are inside bars or dojis. The indecisiveness around a significant resistance level can culminate into a momentum continuation pattern. If the 42K area is cleared, the next key resistance is around 50K. Bitcoin is NOT out of the broader Wave 4 consolidation which means many false starts and false breakouts are HIGHLY likely in contrast to a full out bullish trend. Do NOT be suckered into over exaggerated claims "100K BTC" etc.
Risk on the swing trade time frame can be defined from the 35K level. If longs are taken in anticipation of the momentum follow through, keep in mind R:R is realistic around 1:1 or slightly higher from current levels. This is not the best location for a new swing trade. Better for lower expectation day trades.
The bearish scenario: price rejects the 41K area over the NEXT candle. Like I said, rejection should occur relatively quickly. If you are open to shorting (We ARE NOT), this would be a more appropriate location (compared to 30K). The thing is the stop must be no higher than 43K for swing trades. A decisive close above 42K and price can move much higher. If the bearish rejection unfolds, 35K is a reasonable profit area, NOT 30K. Bitcoin is NOT in a broader bearish trend. so expectations on the bear side should be very conservative.
Avoid getting stuck in an opinion, and do NOT get mixed up by the opinions of others. If you don't have a clear strategy or plan, you can only win randomly. Focus on defining your plan and keep it as simple as possible. In this game, it is more effective to make decisions with LESS information. LESS IS MORE.
Thank you for considering my perspective and analysis. I hope you find it helpful.
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Trade Bybit: bit.ly/bybreg
Trade Mexc: bit.ly/usmexc
