jacobcanfield

Bitcoin Weekly Close Major Decision Point Near Apex Of Triangle

BITMEX:XBTUSD   Bitcoin / US Dollar Perpetual Inverse Swap Contract

Good evening traders. I thought for this analysis, I would give a bit more practical scenarios for Bitcoin movements in the coming days.

From a high time frame perspective, we are have been consolidating in a 20% range for over 2 months now. We are just bouncing back and forth between the 50% fibonacci zone and previous weekly resistance from March 2018 and the 38.2% fibonacci zone and weekly resistance from April 2018 that has now flipped as support.

I also want to state that from a macro view, I am definitely bullish . We are seeing the market in shambles amidst trade wars and currency wars along with gold and alternative stores of value rising. I have no problem with building long positions at $10k, $9500, $9000 or even $8000 zones.

I also want to follow that up with saying it is important to hedge your bets with futures contracts to plan for a move in either direction when evidence is showing a potential drop.


This analysis will be a bit more of a shorter time frame analysis to go along side my previous chart on the 'secret bitcoin buy zones.'

If you haven't checked that analysis out, please do so here.

We have eerily similar structures as last week that are painting a bearish picture that could culminate towards another high volume Sunday sell off like we had last week.

When we sold down, it was obvious that someone was filling their longs as we wicked right back up on the 4 hour chart. (see Green arrow.)

We now have a similar trendline and structure as we approach another weekly close.

Are we going to see another sell off as someone fills their long side buy orders as we take out the weak hands and high leverage longs?

The key is breaking this $10,000 level first, which isn't so easy to do.

So what the hell is holding us up?

Although it seems like a random psychological number actually has a technical level behind it.

It actually coincides with the 100DMA (daily moving average.) and so far we have tested it a total of 6 times. Every time we test it, buys come into the market and push us back up to retest our triangle resistance.

We also rejected at the 20MA where I took my short on the futures market.


The more times a support or resistance is tested, it actually gets weaker, which gives more weight to the 'bearish' case.

But as they say in trading, us something until it no longer works.

So as long as we are above the 200MA, we are okay. But as soon as it breaks, we will most likely see a high volume test to the downside for liquidity.

In regards to the order books, there are significant bids on bitfinex and coinbase to the tune of 2500-3000 BTC down to the $9,000 level.

This means that will be one tough level to crack.

On our futures chart, we also have the 100DMA (daily moving average) and a gap around $8700-$9000 that has not been filled yet.

There is also another gap around $11,700 that we can see as well.


Gaps on the futures chart really like to get filled.

There is also a head and shoulders pattern forming on the 4 hour with a potential measured move down to our $9100 level.

As for alts, if Bitcoin does break up out of our trendline, I expect a mass sell off yet again as we push back down to lower levels.

If Bitcoin can break down, I expect alts (especially majors like ETH and XRP) to get a bounce. (In Bitcoin value, not USD value.)

Dominance is currently forming a symmetrical triangle at the top of a very steep rising wedge , but the 70% zone has formed a strong base that isn't going down without a fight.


It is possible that we do break upwards as the liquidity and volume in the market is very low, so keep your eye out for a trendline / horizontal resistance break at $10,400 for a potential push to $11,000.


As always, please manage your risk appropriately as we prepare for both scenarios and please leave comments below if you are enjoying my work.

Thanks for reading and if you could take a moment to like the chart, it would mean a lot to support my work.
Comment: I forgot to include this as well.


This is a similar structure in that we have a 50% fibonacci pull back and consolidation triangle.

A quick note and reminder. I am short from higher up with my stop loss moved into profit and ready to be closed manually.

This means that if we do break to the upside off of this daily support, I will still have spot bitcoin and will enjoy the move upwards.

If you are not in a position, its best to either buy here (daily support and 100DMA) with a stop below ($9800) or wait for the break out and buy the pull back.

Ideal scenario is we can get some solid buys in the $9000 zone, but as long as the 100DMA holds, it is not ideal to short into a support.

Remember, buy support and sell resistance. Same goes with long and short.

It is typically unwise to short a daily support and long a daily resistance. It's better to let the level break and short the retest.
Comment: Bang
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Comments

I really enjoy your TA, all angles and possibilities simplified and covered well.
I agree, seems more Bearish now and we could drop any moment to the low 9000's as we have tested the current 10K and trend line support many times and those upward volatility spikes on the 4hr get squashed right back down very quickly, I'm short from 10300 and waiting patiently to see how this evening plays out... All we need is a high volume sell drop to start the avalanche!
+4 Reply
jacobcanfield Trader-HP
@Trader-HP, I don't like the way the order book looks though, so I'm honestly preparing for a break either way. Lots of mixed indicators as far as time frames are concerned.
+4 Reply
Trader-HP jacobcanfield
@jacobcanfield, I know buddy, There's so many mixed signals right now, we must be arriving to the 'fork in the road' very soon.
+3 Reply
jacobcanfield Trader-HP
@Trader-HP, Big break to the upside above our trendline
Reply
Trader-HP jacobcanfield
@jacobcanfield, Yep, happened in a hurry & stopped me out. I should've seen that coming with that 4hr hammer candle, showed me a reversal in the works ( me = a Deer in Headlights) and sure enough, it lead right into a new higher opening kicker candle!
+1 Reply
jacobcanfield Trader-HP
@Trader-HP, As soon as teh daily closed, buy bots stepped in and started eating through sell walls. Was an auto flip to long for me.
Reply
Looks like up, big pop
+3 Reply
@Galvin, Yes sir! Stop closed and looking for a nice pull back entry now.

Weekly close was definitely going to be violent.
Reply
Congratulations. Excellent analysis. Great graphic and fundamentalist vision. You know what you do. Success!
+3 Reply
one of the first bitcoin analysis i've seen that aren't complete b.sht. Good job, I still would rather invest in gold rather than bitcoin, but it's interesting seeing if people are right in their analysis or not.
+2 Reply
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