The Market Pushes Snooze Again
Bitcoin has mainly remained flat since last week with only little ups and downs. With the push up on last week Tuesday hopes for an AMD pattern playing out were kindled briefly, but price has since dropped back under 29.5k$. For now the consolidation continues and a dip under the 50% fib retracement level (28 - 28.3k$) mentioned last week is as likely as a sudden start of an expansion to the upside (towards and beyond 31.8k$). On the daily timeframe there currently is not much we can do but wait for the market to pick a direction.
Are we going to make new local lows?
The boring stages of the market are still continuing. Crypto is literally doing nothing, but this is one of the most important times to be active in the market. Reason for that is, people are losing interest, markets are slowely bleeding towards the downside, but this brings the biggest opportunities. The biggest returns are made when nobody is showing interest in the market and not when your neighbor thinks he should get into the market. Looking at the chart, we can say that we are in this building period. We are trading sideways for months already. BTC dominance is rising and alts are heaving a really tough time. If you ask me, it is really important that Bitcoin is going to pick a side. In my opinion, we ar not in a so called manipulation phase at the moment, so I would be looking at lower prices for Bitcoin on the higher timeframe. In todays tradeletter we are going to discuss which levels I am going to look at if we get that drop.
Trade Letter #179 : Everyone’s Awake Now
BTC price plummeted about 12% on Thursday. While we had mentioned a good possibility that price could dip towards 27.5k, the correction was faster and deeper than anticipated, causing more crypto positions to get liquidated than during the FTX collapse in November 2022. The positive view is that the price is holding the daily bullish order block between 24,824 - 26,087$. As long as we do not see daily candle closes below 24,824$ (may vary between trading pair and exchanges) there is still technical hope over the short to medium term. The RSI is currently around 21, far into the overextended negative territory. I will be watching this week whether a positive divergence will start forming here while price still holds the order block level.
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The final flush?
In the tradeletter from last week I tried to warn all of you that it was very likely that we were going to see a move lower on BTC. Well we all know what happened next.. The flush was quite harsh and to be honest I did not expect the price to drop this far, but why did it drop this far? The harsh drop on Bitcoin, and the entire cryptomarket, came due to the fact that we have very low liquidity in the marketplace. There is no volume to trade effectively, all moves are fueled by borrowed money and the interest in crypto is really low. All these things simply create a very bad trading environment. However, what should we expect from crypto in the coming days? In this tradeletter we are going to make a deepdive into BTC to see what we should look out for.
Trade Letter #182 : Living on the Edge
Bitcoin has been consolidating at around 26,000$ since its corrective drop on August 17, keeping the market on edge. The RSI has slowly been creeping back up towards the 30 mark, but still has some ground to cover. As long as the bullish order block holds and RSI keeps grinding to the upside, there isn’t much to update on the technical side. Further weakness would be signaled through daily candle closes under the bullish order block (<24,824$) while the first level to break for some upside optimism is the 0.5 fib level of our current range (28,307,46$).
Macro Monday #185 : ECG R Wave
The short lived uptick in BTC price didn’t make it quite to the 50% retracement level. On the bright side the order block is still holding support. I remain cautiously bullish, especially with the RSI creeping up slowly, at least until the 24,770.5$ swing low is taken out for good. However there are no trade opportunities on the daily timeframe except the long mentioned in past updates with an invalidation under the order block and targets of the 50% retracement level and the previous high range of around 30,800 - 31,800$.
Bear PA to Condition Bulls?
Another week, another short lived uptick in BTC price this time barely pushing towards 26.5k$. The order block is still holding support. RSI is still in an upwards trajectory. Feels like bulls are getting conditioned to believe that “all breakout attempts fail anyways” and the bears are waiting for 12k$. Trading wise staying sidelined until the market picks a clear direction makes sense, at least before taking on heavy exposure. One news article or rumor could cause price to spike in either direction, but if that first move will then turn into a trend needs confirmation.
A Bit More Patience
Nothing has changed structurally for BTC since I wrote the last Macro Monday Trade Letter two weeks ago. The bullish order block is still being respected, and accumulation continues. I expect 1 - 2 weeks of sideways chop, with potential mini “fakeouts” in both directions, but the main thing I am interested in seeing is whether the order block continues to hold. As long as we do not get a confirmed break of this support, it’s simply a waiting game. If price action continues to mimic some more of standard “bore them out of the market” fractals, once (if) things start moving to the upside, the move will be swift.
Are We There Yet?
The U.S. Securities and Exchange Commission (SEC) has surprised market participants by prematurely delaying its decision on several spot bitcoin Exchange-Traded Fund (ETF) applications. Prominent candidates affected by this delay include BlackRock, Invesco, Bitwise, and Valkyrie. Despite the news, Bitcoin took out the swing highs of September 19 and August 29 today, and developing a higher high - higher low pattern. For a temporary uptrend to continue, price should stay over 26k$, and after another higher low, ideally around 27 - 27.5k$, the dealing range EQ of 28.3k$ can be broken. If this will be the case, a further increase towards at least 30k$ can be anticipated.