Good morning ladies and gentlemen and welcome back to my daily look into the exciting ups and downs of Bitcoin. Today I have the daily time frame pulled up after a nice little pump yesterday. Impressive. We are sitting above a lot of support and this allows confidence to flourish in a recently shaky market (*thanks to some recent FUD) But even with some pretty bad news over the past few weeks Bitcoin has been showing its resiliency as a reliable investment. The bulls decided to stay up late last night and we are now sitting pretty if you ask me. But will it continue? Lets take a look at the situation.
The bulls pushed us above the "line in the sane" that I have been talking about on and off over the last few weeks. 11100 or the .382 fib was the real hurdle that was on my radar for the last few weeks. Even the entire month of August we stayed above 11100 and each time we approached the .382 fib we bounced up. That is until the head and shoulders finally completed at the end of August and brought us down to the upper 9k region. No surprise there though. That was a pretty decent head and shoulders pattern. When traders noticed it the market reacted to the news and you saw the resulting drop soon after. Traders are like a well oiled machine and when something is so evident and obvious like the head and shoulders we saw in August the market reacts in kind and people prepare for a drop and either sell to catch the bottom or just sell to escape the drop. Either way that took us down around 1500 dollars in a matter of hours.
Now lets talk about support. All of August we had 11100 as support and when the head and shoulders took us down below the support it flipped to resistance. That is how the charts work folks. Understanding and identifying support and resistance is the most important thing a trader can learn. This time it is pretty easy to see the .382 (11100) was support and when we fell it became resistance. That remained the case all of September and last night we finally broke back above the support that flipped to resistance during September and now it is support once again. I would really like to see a few candles close above 11100 before I get too excited. Now as a trader I want to identify the next hurdle we will have to jump. So lets take a look.
11660 looks to be where the .236 fib is and I would expect some resistance to form here. Although there is not really much evidence that it has acted as reliable support and resistance I would still keep an eye on this level. It looks to me that the entire month of August we spent trying to conquer the .236 (11660) and we did eclipse the fib from time to time but ultimately we succumbed to the bears advances and dropped each time we jumped above the resistance/support line. Now we are readying ourselves for another attempt at taking the .236. The support below us is allowing confidence to flourish at the moment so good things could happen this weekend. We have my entire trading set up (50 MA, 200 MA, ichimoku cloud) on the daily and the 4hr below us at the moment. So things look great to me. But you better believe Im not trading without a stop loss.
We made it as far as 11500 before falling to where we sit currently and that is 11325. When I checked out the 4hr time frame I see 3 continuation patterns. Up followed by a few sideways candles and then another leg up. I like when I can trade situations like this. I walk my stop up every leg and when it works out like this it sure is fun. Profit followed by more profit!! Who wouldnt enjoy that? The bears must be hibernating as there is no sign of them on the charts for now. But be on the look out. They are sneaky. Set that stop loss folks. I know its easy to forget about a stop loss when things are going good but that is why they say "if you are happy and you know it sell"... After us escaping relatively unscathed from the FUD from the Kucoin hack and the Bitmex fiasco. I certainly expected a bigger drop when I read about the arrest. I found out that Bitcoin is resilient. More resilient than I thought it was. Still. Protect yourself and set a stop loss. I hope you all have a great weekend. Make good choices! WTFDIK?????
TLDR: We broke above 11100. That is great news. Lets hope the bulls can keep this up. We need to close today above 11100 and preferably another candle above 11100 to solidify this move.
The bulls pushed us above the "line in the sane" that I have been talking about on and off over the last few weeks. 11100 or the .382 fib was the real hurdle that was on my radar for the last few weeks. Even the entire month of August we stayed above 11100 and each time we approached the .382 fib we bounced up. That is until the head and shoulders finally completed at the end of August and brought us down to the upper 9k region. No surprise there though. That was a pretty decent head and shoulders pattern. When traders noticed it the market reacted to the news and you saw the resulting drop soon after. Traders are like a well oiled machine and when something is so evident and obvious like the head and shoulders we saw in August the market reacts in kind and people prepare for a drop and either sell to catch the bottom or just sell to escape the drop. Either way that took us down around 1500 dollars in a matter of hours.
Now lets talk about support. All of August we had 11100 as support and when the head and shoulders took us down below the support it flipped to resistance. That is how the charts work folks. Understanding and identifying support and resistance is the most important thing a trader can learn. This time it is pretty easy to see the .382 (11100) was support and when we fell it became resistance. That remained the case all of September and last night we finally broke back above the support that flipped to resistance during September and now it is support once again. I would really like to see a few candles close above 11100 before I get too excited. Now as a trader I want to identify the next hurdle we will have to jump. So lets take a look.
11660 looks to be where the .236 fib is and I would expect some resistance to form here. Although there is not really much evidence that it has acted as reliable support and resistance I would still keep an eye on this level. It looks to me that the entire month of August we spent trying to conquer the .236 (11660) and we did eclipse the fib from time to time but ultimately we succumbed to the bears advances and dropped each time we jumped above the resistance/support line. Now we are readying ourselves for another attempt at taking the .236. The support below us is allowing confidence to flourish at the moment so good things could happen this weekend. We have my entire trading set up (50 MA, 200 MA, ichimoku cloud) on the daily and the 4hr below us at the moment. So things look great to me. But you better believe Im not trading without a stop loss.
We made it as far as 11500 before falling to where we sit currently and that is 11325. When I checked out the 4hr time frame I see 3 continuation patterns. Up followed by a few sideways candles and then another leg up. I like when I can trade situations like this. I walk my stop up every leg and when it works out like this it sure is fun. Profit followed by more profit!! Who wouldnt enjoy that? The bears must be hibernating as there is no sign of them on the charts for now. But be on the look out. They are sneaky. Set that stop loss folks. I know its easy to forget about a stop loss when things are going good but that is why they say "if you are happy and you know it sell"... After us escaping relatively unscathed from the FUD from the Kucoin hack and the Bitmex fiasco. I certainly expected a bigger drop when I read about the arrest. I found out that Bitcoin is resilient. More resilient than I thought it was. Still. Protect yourself and set a stop loss. I hope you all have a great weekend. Make good choices! WTFDIK?????
TLDR: We broke above 11100. That is great news. Lets hope the bulls can keep this up. We need to close today above 11100 and preferably another candle above 11100 to solidify this move.