The fundamental underlying thesis: Bitcoin fixes this.
The bear market has been sufficiently brutal. We had a monthly downtrend that took the price deep into the discount zone of the prior bull's range.
A few of the prominent players in the industry and bull-run darlings have gone belly-up or have faced existential adversity. Some of the most haunting nightmares (regulatory crackdowns, banking chokepoints, institutions dumping the space) have come to life and became news.
The bounce off the November '22 low was sharp and resulted in invalidation of the freshly printed monthly downtrend signal.
It looks like there is no liquidity from capitulating long-term hodlers and '20-'21 FOMO-buyers left to speak of. The market is in the early growth stages and the main task it is performing atm is to displace weak hands that have bought and keep buying on the way up.
Technically, so far this has manifested in a successful weekly uptrend, followed by a 2W accumulation . Now we've had a new uptrend signal from that accumulation.
It's worth noting that both these accumulations culminated in a significant dip right before flashing the uptrend signal. The dips were pretty striking in the context of the previous PA and resulted in quite a grim sentiment (both times happening against the backdrop of some heavy FUD). However, both times the price has entered the discount zone of the prior swing in a very brief and shallow way only.
This scary drop followed by the sharp breakout left many hands regretfully sidelined. On the one hand, selling/not buying clearly was not a good decision, on the other – buying looks risky, the price is in the "no man's land". A pullback to the levels, from which the breakout has started, or even to the mode of the 2W accumulation around 27K, would give those sidelined hands a second chance.
This being said, following the breakout there has been a certain warming up of the sentiment and “we’re so back” vibes seem to be resurfacing. The price stalling here and, perhaps, doing some pullback would make sense. The last impulse has harvested the liquidity above the April highs, the high of the move came against the bear-market speedline resistance.
Combining these two considerations together, I see a relatively shallow pullback followed by continuation of the 2W uptrend as the most logical path forward. This will cool down any excessive bullish sentiment triggered by the recent move, while not giving those who missed the train off the 25K levels the gift of getting back in like nothing happened. I give this scenario about 40% probability. I also expect it to include some smaller TF fuckery to cut off opportunistic longs with tight stops.
The close second probability is continuation of the 2W uptrend without any significant pullback. I see it a bit less likely, since the recent pause in the move combined with a string of bullish news should have attracted a certain non-trivial amount of exploitable liquidity in weak longs. I give this scenario a 30% probability.
The idea of the trade is to long the next 2W upswing, keeping both scenarios in mind (which gives it a total of 70% probability). The idea would be fully invalidated if the 2W uptrend signal fails, but, given considerations above, it makes sense to aim for the major part of entries with more aggressive stops than that.
The successful 4H uptrend last week culminated in the local top.
The price has retraced since then and has formed an accumulation setup on 12H TF, while staying above the short-term moving averages.
The accumulation has been happening deep in the discount zone of the last 4H swing.
The 12H setup represents the second of the above scenarios well. The chop can last longer here, and turn into a setup on the daily TF. For instance, the PCE report due this Friday could serve as a containing factor until then.
If this setup fails, the next area of interest will be the 2W retrace buy zone around 29K, which will in turn represent the first scenario.
If the price pulls back below 28450 this will form a new accumulation setup and the trade idea will need to be revised.
The bear market has been sufficiently brutal. We had a monthly downtrend that took the price deep into the discount zone of the prior bull's range.
A few of the prominent players in the industry and bull-run darlings have gone belly-up or have faced existential adversity. Some of the most haunting nightmares (regulatory crackdowns, banking chokepoints, institutions dumping the space) have come to life and became news.
The bounce off the November '22 low was sharp and resulted in invalidation of the freshly printed monthly downtrend signal.
It looks like there is no liquidity from capitulating long-term hodlers and '20-'21 FOMO-buyers left to speak of. The market is in the early growth stages and the main task it is performing atm is to displace weak hands that have bought and keep buying on the way up.
Technically, so far this has manifested in a successful weekly uptrend, followed by a 2W accumulation . Now we've had a new uptrend signal from that accumulation.
It's worth noting that both these accumulations culminated in a significant dip right before flashing the uptrend signal. The dips were pretty striking in the context of the previous PA and resulted in quite a grim sentiment (both times happening against the backdrop of some heavy FUD). However, both times the price has entered the discount zone of the prior swing in a very brief and shallow way only.
This scary drop followed by the sharp breakout left many hands regretfully sidelined. On the one hand, selling/not buying clearly was not a good decision, on the other – buying looks risky, the price is in the "no man's land". A pullback to the levels, from which the breakout has started, or even to the mode of the 2W accumulation around 27K, would give those sidelined hands a second chance.
This being said, following the breakout there has been a certain warming up of the sentiment and “we’re so back” vibes seem to be resurfacing. The price stalling here and, perhaps, doing some pullback would make sense. The last impulse has harvested the liquidity above the April highs, the high of the move came against the bear-market speedline resistance.
Combining these two considerations together, I see a relatively shallow pullback followed by continuation of the 2W uptrend as the most logical path forward. This will cool down any excessive bullish sentiment triggered by the recent move, while not giving those who missed the train off the 25K levels the gift of getting back in like nothing happened. I give this scenario about 40% probability. I also expect it to include some smaller TF fuckery to cut off opportunistic longs with tight stops.
The close second probability is continuation of the 2W uptrend without any significant pullback. I see it a bit less likely, since the recent pause in the move combined with a string of bullish news should have attracted a certain non-trivial amount of exploitable liquidity in weak longs. I give this scenario a 30% probability.
The idea of the trade is to long the next 2W upswing, keeping both scenarios in mind (which gives it a total of 70% probability). The idea would be fully invalidated if the 2W uptrend signal fails, but, given considerations above, it makes sense to aim for the major part of entries with more aggressive stops than that.
The successful 4H uptrend last week culminated in the local top.