As you can see by the chart displayed, the total cryptocurrency market cap is in a clear Equilibrium pattern despite certain coins breaking into weekly uptrends and some getting within 1-2% ranges from bull breaks. We also have the 12 and 200 Weekly Exponential Resistances just above the current price which creates a more favourable trading environment for the bears on a weekly time frame.
The reason I argue that this is a more favourable trading environment for the bears is:
1- Low of Equilibrium pattern is around 3300USD so there is still a lot of room to the downside to for a higher low and continuing to tighten.
2- 12 and 200 exponential resistances overhead.
3- (Referring to BTC as a trade) Since we are a lot closer to the top of the Equilibrium range as opposed to the bottom, if one wants a bit more risk in their trade and doesn't want to await confirmation, a stop loss above EMAs or EQ top would be less of a margin then a stop loss below supports if a long position was taken.
4- The Macro Trend is still bearish. Until the trend is ACTUALLY changed, then the current trend has to be respected.
IF you are bullish, based off this chart and trading from the weekly time frame, I would not take any positions at the moment as an efficient risk management plan does not seem possible until a better set up occurs.
All in all, the best thing to do in this situation would be to wait for confirmation of a marketcap EQ break before entering long or short on trades. If I was forced to take a position, then as stated above, I would go short with stop losses in place from above EMAs to above EQ on BTC.
I am the Unemotional, Devotional Trader that Society doesn't deserve, but needs!
The reason I argue that this is a more favourable trading environment for the bears is:
1- Low of Equilibrium pattern is around 3300USD so there is still a lot of room to the downside to for a higher low and continuing to tighten.
2- 12 and 200 exponential resistances overhead.
3- (Referring to BTC as a trade) Since we are a lot closer to the top of the Equilibrium range as opposed to the bottom, if one wants a bit more risk in their trade and doesn't want to await confirmation, a stop loss above EMAs or EQ top would be less of a margin then a stop loss below supports if a long position was taken.
4- The Macro Trend is still bearish. Until the trend is ACTUALLY changed, then the current trend has to be respected.
IF you are bullish, based off this chart and trading from the weekly time frame, I would not take any positions at the moment as an efficient risk management plan does not seem possible until a better set up occurs.
All in all, the best thing to do in this situation would be to wait for confirmation of a marketcap EQ break before entering long or short on trades. If I was forced to take a position, then as stated above, I would go short with stop losses in place from above EMAs to above EQ on BTC.
I am the Unemotional, Devotional Trader that Society doesn't deserve, but needs!
remember to keep a close watch on the weekly EQ and to make sure you take it into consideration when placing trades. For anyone following my weekly analysis of BTC and MKTCAP for the past two weekly published ideas, congratulations!!