Let's do the point !
Here I want to share you the inside of the market, some could say : "we are ranging" 👉 Yes .... but NO. What is happening actually is way more than a range, it's a change in the dynamic of the market which will impact the structure as bear or bull is the outbreak.
My point of view for the evolution of the market didn't change since the last update (LDTP#7 attached), if you want to know it you will find it in because I will not develop it here.
So like I said, yes it's a range, but no because it's more than that and to understand that, we will speak of dynamics in a market. Let's go back to the basics : your market arc itself in movement with trend or not. And in these movements we always have notions of equilibrium. If you didn't understood why we use fibonacci in trading it's simply because of that. A trend will provide movement with trend which have more displacement of price than a movement without trend and the balance between these two movement is,ON AVERAGE , 61.8%/38.2%. In every way you take your market you will find it : retracement, projections, temporality and of course volumes.
Here an exemple with BTC but you can entertain yourself by trying it (usually) EVERYWHERE on (usually) EVERY assets :
That not what's I will develop, so why it's important here ? Like I said your market arc itself in movement with trend or not (this is the equilibrium that I just explain), but not only, when you break your equilibrium you are not anymore in a movement but in a anomaly of market where your market is one sided. Because of the change of dynamic the logarithmic arc of your movement is broke by another, exponential this time. On a one sided movement you will see increasing volumes too. Typical example of one sided movement : bull run ! So here the example (*arc not ark on picture):
So now you are supposed to start to understand the initial chart. We see well the break between the two arcs which, fun fact, is the break of the 61.8% retracement of the last upside. I also added all significant volumes with arrows which show the dominance of sellers and now ... the neutrality. So let's explain that now.
When you are in a one sided movement, reversal don't come from the opposite side because they can't exist, so it come from the movement itself, exception for anomalies of market of course (for example news : take the russian market you will see how a news can impact). And the first step to see it end is the movement created by taking profits (basically here : sellers which take profit becomes buyers), then they will be overwhelmed by the one sided supply. This process will take place until we create a demand level which mean basicly the repositionning of buyers in market. Then will happen a ping pong party between the supply and the demand. And most of the time we will see a succeed reversal pattern, that we can assimilate to a large U-TURN pattern, because most of the time institutionnals win and retails lose. And if you understand the market you know where are institutionnals on this pattern.
The neutrality in volumes with both significant buyers and sellers are typical of this phase which can help you to identify the end of the one sided movement (also for a range but we usually don't have a range for this phase).
(NB : if you take back the weekly view wih bullrun you can identify the large U-TURN pattern on top like I drawn on chart but reversed)
Now if we talk back of BTC, we can see we don't have this large U-TURN shape but something more similar to a common range. This mean two things : or institutionnals directly reversed their positions from sellers to buyers which create directly a demand level OR they love Wyckoff Accumulation Pattern (WAP) for this asset.
You know what I think of WAP on BTC, so I bet for a WAP, and when I see volumes, I bet for a spring, soon (I will develop this WAP just after in the LDTP#8.2 so follow me if you aren't already).
I will not hide that hurts me to say that, because that mean take a L to re-enter probably just under, but strategy is strategy and like I always say : "Making money in trading is math and respect of strategy, so never let your emotions guide you in uncomfortable positions".
To finish, I said in the intro : "it's a change in the dynamic of the market which will impact the structure as bear or bull is the outbreak". Simply because if we do a bear break, fail the spring and so start a new bear movement, we will be in a new dynamics, and even if it could bring us to a break of the bullish weekly trend, this dynamic will probably not be one sided but more split in multiples movements where exploit each movement will be more profitable than try to take the whole trend movement (equilibrium of market).
Like, follow or comment if you like, it give me some strength to continue ! Ask questions if you have some too !
Here I want to share you the inside of the market, some could say : "we are ranging" 👉 Yes .... but NO. What is happening actually is way more than a range, it's a change in the dynamic of the market which will impact the structure as bear or bull is the outbreak.
My point of view for the evolution of the market didn't change since the last update (LDTP#7 attached), if you want to know it you will find it in because I will not develop it here.
So like I said, yes it's a range, but no because it's more than that and to understand that, we will speak of dynamics in a market. Let's go back to the basics : your market arc itself in movement with trend or not. And in these movements we always have notions of equilibrium. If you didn't understood why we use fibonacci in trading it's simply because of that. A trend will provide movement with trend which have more displacement of price than a movement without trend and the balance between these two movement is,ON AVERAGE , 61.8%/38.2%. In every way you take your market you will find it : retracement, projections, temporality and of course volumes.
Here an exemple with BTC but you can entertain yourself by trying it (usually) EVERYWHERE on (usually) EVERY assets :
That not what's I will develop, so why it's important here ? Like I said your market arc itself in movement with trend or not (this is the equilibrium that I just explain), but not only, when you break your equilibrium you are not anymore in a movement but in a anomaly of market where your market is one sided. Because of the change of dynamic the logarithmic arc of your movement is broke by another, exponential this time. On a one sided movement you will see increasing volumes too. Typical example of one sided movement : bull run ! So here the example (*arc not ark on picture):
So now you are supposed to start to understand the initial chart. We see well the break between the two arcs which, fun fact, is the break of the 61.8% retracement of the last upside. I also added all significant volumes with arrows which show the dominance of sellers and now ... the neutrality. So let's explain that now.
When you are in a one sided movement, reversal don't come from the opposite side because they can't exist, so it come from the movement itself, exception for anomalies of market of course (for example news : take the russian market you will see how a news can impact). And the first step to see it end is the movement created by taking profits (basically here : sellers which take profit becomes buyers), then they will be overwhelmed by the one sided supply. This process will take place until we create a demand level which mean basicly the repositionning of buyers in market. Then will happen a ping pong party between the supply and the demand. And most of the time we will see a succeed reversal pattern, that we can assimilate to a large U-TURN pattern, because most of the time institutionnals win and retails lose. And if you understand the market you know where are institutionnals on this pattern.
The neutrality in volumes with both significant buyers and sellers are typical of this phase which can help you to identify the end of the one sided movement (also for a range but we usually don't have a range for this phase).
(NB : if you take back the weekly view wih bullrun you can identify the large U-TURN pattern on top like I drawn on chart but reversed)
Now if we talk back of BTC, we can see we don't have this large U-TURN shape but something more similar to a common range. This mean two things : or institutionnals directly reversed their positions from sellers to buyers which create directly a demand level OR they love Wyckoff Accumulation Pattern (WAP) for this asset.
You know what I think of WAP on BTC, so I bet for a WAP, and when I see volumes, I bet for a spring, soon (I will develop this WAP just after in the LDTP#8.2 so follow me if you aren't already).
I will not hide that hurts me to say that, because that mean take a L to re-enter probably just under, but strategy is strategy and like I always say : "Making money in trading is math and respect of strategy, so never let your emotions guide you in uncomfortable positions".
To finish, I said in the intro : "it's a change in the dynamic of the market which will impact the structure as bear or bull is the outbreak". Simply because if we do a bear break, fail the spring and so start a new bear movement, we will be in a new dynamics, and even if it could bring us to a break of the bullish weekly trend, this dynamic will probably not be one sided but more split in multiples movements where exploit each movement will be more profitable than try to take the whole trend movement (equilibrium of market).
Like, follow or comment if you like, it give me some strength to continue ! Ask questions if you have some too !
