Hello all,
After what can only be described as a euphoric sigh of relief, Bitcoin bears were sent scrambling this past week as price rallied more than 20% off the bottom. While a little slow, our $459 buy signal turned out to be quite accurate as we have moved steadily higher since that breakout event. The initial price objective of around $500 was hit and I did take the liberty of letting some of my position go. I continue to respect the notion of slowly spoon feeding the market coins as price moves higher. I have indeed sold (and booked profits) on the rally. On top of seeing your balance sheet grow, I think mentally its a good idea to reward yourself a little with these positive affirmations. I still have 1/3 of my long position and feel as though I want to keep a good chunk of that going forward. Indeed, I would go so far as to say I will try and rebuild my long position (to get longer...if that is a word....lol) on any pullbacks of substance. So the question then becomes, is it time to start looking for that correction/pullback and roughly where would historically 'normal' corrections suggest might be good reloading zones???
Is the rally over?
Price itself seems to be stalling near the previous significant peak ($547) and may hint at some serious resistance ('battle line' refereed to on chart above). The rather noticeable bear divergences within both volume and momentum suggests two things to me. 1. the divergent move itself was likely to fail unless some serious new volume/momentum came in (which it did not) & 2. The market is in need of time to 'clean up' the divergent condition. This also suggests we are in need of at least a consolidation before another leg higher in price can begin in earnest.
If I was to buy, where would I be looking?
Two areas on the 4hr price chart jump out at me as areas I shall be looking for price, volume and momentum to turn. 1. my time tested '1st stop' target or the 38.2 Fib (496.88) is well within expectations here. A consolidation off this level and then a subsequent turn higher would be rather bullish and would suggest prices could easily hit indicated longer-term upside targets. Considering too the psychological significance of $500 (bfrn) a revisit of this important level certainly isn't out of the question. & 2. The Optimal Trade Entry (OTE) long zone off the 4hr double bottom suggests institutions may get interested in buying should we trade into that area (467.30 to 446.23). Considering the fact that the 4hr 200 sma and a significant uptrend line both happen to be in that window further suggests to me this area is of high interest going forward.
Cautionary note.
I am not a big fan of working open orders blindly. If I were to consider buying I will need to see confirmation from both volume and momentum. Please don't assume that because a level is hit the asset is a 'buy'....Unfortunately, if it were that easy we would all be millionaires, eh !?!?......lol
Summary
After what was a very nice week, I recon BTC needs a little time to 'clean up'. I have sold some of my $459 purchase but will keep a chunk of it on the books as the daily charts suggest purchases in the $400 area are not a bad 'investments'. I am watching for price to come back into two potential trade location windows and will re-enter longs on appropriate indications from my indicators near those levels.
Cheers all and I hope my simple analysis is of benefit...
If my charts help you, or you use my indicators...
please consider a BTC donation to allow me to
continue my work :
1EBttA56cWsgtsZn83VGiNT8si7inZV5Z5
& follow me on Twitter @CRInvestor
After what can only be described as a euphoric sigh of relief, Bitcoin bears were sent scrambling this past week as price rallied more than 20% off the bottom. While a little slow, our $459 buy signal turned out to be quite accurate as we have moved steadily higher since that breakout event. The initial price objective of around $500 was hit and I did take the liberty of letting some of my position go. I continue to respect the notion of slowly spoon feeding the market coins as price moves higher. I have indeed sold (and booked profits) on the rally. On top of seeing your balance sheet grow, I think mentally its a good idea to reward yourself a little with these positive affirmations. I still have 1/3 of my long position and feel as though I want to keep a good chunk of that going forward. Indeed, I would go so far as to say I will try and rebuild my long position (to get longer...if that is a word....lol) on any pullbacks of substance. So the question then becomes, is it time to start looking for that correction/pullback and roughly where would historically 'normal' corrections suggest might be good reloading zones???
Is the rally over?
Price itself seems to be stalling near the previous significant peak ($547) and may hint at some serious resistance ('battle line' refereed to on chart above). The rather noticeable bear divergences within both volume and momentum suggests two things to me. 1. the divergent move itself was likely to fail unless some serious new volume/momentum came in (which it did not) & 2. The market is in need of time to 'clean up' the divergent condition. This also suggests we are in need of at least a consolidation before another leg higher in price can begin in earnest.
If I was to buy, where would I be looking?
Two areas on the 4hr price chart jump out at me as areas I shall be looking for price, volume and momentum to turn. 1. my time tested '1st stop' target or the 38.2 Fib (496.88) is well within expectations here. A consolidation off this level and then a subsequent turn higher would be rather bullish and would suggest prices could easily hit indicated longer-term upside targets. Considering too the psychological significance of $500 (bfrn) a revisit of this important level certainly isn't out of the question. & 2. The Optimal Trade Entry (OTE) long zone off the 4hr double bottom suggests institutions may get interested in buying should we trade into that area (467.30 to 446.23). Considering the fact that the 4hr 200 sma and a significant uptrend line both happen to be in that window further suggests to me this area is of high interest going forward.
Cautionary note.
I am not a big fan of working open orders blindly. If I were to consider buying I will need to see confirmation from both volume and momentum. Please don't assume that because a level is hit the asset is a 'buy'....Unfortunately, if it were that easy we would all be millionaires, eh !?!?......lol
Summary
After what was a very nice week, I recon BTC needs a little time to 'clean up'. I have sold some of my $459 purchase but will keep a chunk of it on the books as the daily charts suggest purchases in the $400 area are not a bad 'investments'. I am watching for price to come back into two potential trade location windows and will re-enter longs on appropriate indications from my indicators near those levels.
Cheers all and I hope my simple analysis is of benefit...
If my charts help you, or you use my indicators...
please consider a BTC donation to allow me to
continue my work :
1EBttA56cWsgtsZn83VGiNT8si7inZV5Z5
& follow me on Twitter @CRInvestor