Ascend triangle on BTC, or Double top? BTC with ETH/BTC analysis
In this chart we have BTC/USD in the green and red bars, while ETH/BTC in the purple and magenta. I want to compare the two to really understand why BTC is moving up the way it is and identifiers that will help us know when it will reverse and a potential trade opportunity. This will help us know what to look when we enter and knowing why and how to be cautious.
If we look at ETH and LTC, it's clear that BTC has been dominating trading as investors are exchanging for BTC driving the price significantly higher. this has kept LTC and ETH suppressed while BTC has been driven up significantly. Before I get into specifics, let's examine a few important pieces going on with these overlays.
1.Timewise, the signifcant bottoms of ETH/BTC generally happen before BTC/USD and this time varies from a small time frame of 5 days to a much more significant time of upwards of 2 weeks.
2. The move's in ETH/BTC move much more dramatically than BTCUSD. IE: Early Jan we had ETH/BTC move up significantly while BTC/USD did not move down as much
These are important to notate as we look into why it could go up or it could reverse. It gives us a little extra insight as to whats going on and what to look for.
Signs we could keep going up:
1. BTC is forming a large ascending triangle
2. Strong MACD
3. If you zoom in on ETHBTC you will notice it's already broken it's low and looks to be heading lower. This gives it a lot of room to keep going down. I would guess it will at least go to that previous range which I have a blue support line on.
Signs we could reverse and go down:
1. Double top on BTC in conjunction with RSI double top??
2. ETHBTC is showing signs of RSI divergence on the daily chart. Are we close to bottoming there?
3. Low volume on this chart and on gdax. This is also confirmed by no USD buying power in LTC or ETH. Looks like we only been going up on shear crypto cross trading. This could be argued to be good or bad.
Here are some strategies to enter: BTC comes down to this 10,500 level and completes one more wave on this ascending triangle and then continues up. Lot of ways you can play it depending on how risky you want to be and depending on what it does from here. You can buy a potential dip, or wait for confirmation and buy the breakout. If we get confirmation that it does break out, I would look for a move to the upper end of the 12k mark, in the 12.9k range. Expect it to wander up like it has been. I would NOT go in heavy for this trade. the technical stops are either below 9.5 if you enter at 10.5k or just below the support line on the breakout.This has the potential of a reversing down hard so be careful.
A cautionary warning: We really need to wait for a confirmation to enter in a trade and watch it closely. My martingale trades early last month I felt much more confidence in and we made out great. This does show signs of reversing and we don't want to be caught with our pants down so enter with caution.
Happy Trading - Don't stress and pick your points!
-Sherem
If we look at ETH and LTC, it's clear that BTC has been dominating trading as investors are exchanging for BTC driving the price significantly higher. this has kept LTC and ETH suppressed while BTC has been driven up significantly. Before I get into specifics, let's examine a few important pieces going on with these overlays.
1.Timewise, the signifcant bottoms of ETH/BTC generally happen before BTC/USD and this time varies from a small time frame of 5 days to a much more significant time of upwards of 2 weeks.
2. The move's in ETH/BTC move much more dramatically than BTCUSD. IE: Early Jan we had ETH/BTC move up significantly while BTC/USD did not move down as much
These are important to notate as we look into why it could go up or it could reverse. It gives us a little extra insight as to whats going on and what to look for.
Signs we could keep going up:
1. BTC is forming a large ascending triangle
2. Strong MACD
3. If you zoom in on ETHBTC you will notice it's already broken it's low and looks to be heading lower. This gives it a lot of room to keep going down. I would guess it will at least go to that previous range which I have a blue support line on.
Signs we could reverse and go down:
1. Double top on BTC in conjunction with RSI double top??
2. ETHBTC is showing signs of RSI divergence on the daily chart. Are we close to bottoming there?
3. Low volume on this chart and on gdax. This is also confirmed by no USD buying power in LTC or ETH. Looks like we only been going up on shear crypto cross trading. This could be argued to be good or bad.
Here are some strategies to enter: BTC comes down to this 10,500 level and completes one more wave on this ascending triangle and then continues up. Lot of ways you can play it depending on how risky you want to be and depending on what it does from here. You can buy a potential dip, or wait for confirmation and buy the breakout. If we get confirmation that it does break out, I would look for a move to the upper end of the 12k mark, in the 12.9k range. Expect it to wander up like it has been. I would NOT go in heavy for this trade. the technical stops are either below 9.5 if you enter at 10.5k or just below the support line on the breakout.This has the potential of a reversing down hard so be careful.
A cautionary warning: We really need to wait for a confirmation to enter in a trade and watch it closely. My martingale trades early last month I felt much more confidence in and we made out great. This does show signs of reversing and we don't want to be caught with our pants down so enter with caution.
Happy Trading - Don't stress and pick your points!
-Sherem
Comment:
We are getting close to a breakout here. I am still waiting for any type of confirmation. We are getting some serious divergence on the RSI on ETH/BTC
Comment:
Same divergence with BTC/USD but not as strong. I don't give this one as much weight as much as ETH/BTC, as I feel ETH/BTC going down has driven BTCUSD up. We'll wait and see what happens here.
Comment:
To clarify, I will only be trading BTC/USD, not ETH/BTC in the event of a breakout to the upside.
Comment:
This is why we wait for confirmation to enter a trade. It's moving down fairly quickly, we'll see if it confirms this double top at this 11k-11.2k area it's starting to hit. If it breaks that, we will be going down further.