BTC Pullback Areas to Go Long
Updated
Here are the Bitcoin Momentum Long Downside Entry Areas I'm watching.
On 05 JAN 2023 Bitcoin turned MOMENTUM Long. On 11 JAN 2023 the Day chart went from BIAS short to BIAS Long.
This area and slightly above on the 4D chart would be the swing trade profit areas and the highest probable areas for entering a FADE Short position.
The Entry Reaction Zones
Note: Given the range from this week's open you really don't want to see a week open test. If so it better reject quickly. Watching the 30m chart if this happens will be key.
Also, the RDA is between the fast and slow momentum indicators. That might just be the best entry if there is a pullback momentum check.
The Daily chart provides these levels:
How I Trade This With My System (as seen on chart)
On top of those areas, I would define reaction areas based on levels using the RD Level Rules.
With the Daily reaction areas and levels defined, I then decide on my primary timeframe.
I like the 60m combined with looking at the 30m for structure. For instance, as I write this the 60m RDA is sitting right at 19K. The slow momentum is at 19,4.
More aggressive reaction areas to go long are at these areas I just mentioned.
In these areas, there will be a reaction; how big and if momentum and bias will remain long on the 60m chart is unknown. Looking at 5m and tick charts will reveal when and if price gets there.
Also, you don't want to see the 60m VC range that lasted 22h between 18,770 to 19,080 to be closed below more than 2-3 60m candles. For a continuation of momentum long if this area is tested you want to see that buyers are stepping up on the test.
Risk and Stop Losses
Pretty obvious here. The "protection" stop loss is 16,730, well below the weekly open. This allows for weekly open test overshoot a bit.
For a more managed stop loss placement, I'd use the 60m chart. I'd check in 2-3 times a day. When the momentum on the 60m chart shifts from momentum long to momentum short you now have your upside level. From there, it's really looking at the volatility of those moves. Also, combining with the 30m chart will provide correlating zones.
The bottom line is if you are looking to go long on a pullback other than a quick downward move that you can watch on the 5m chart to find buy support, you're going to have to watch how the 60m momentum plays out. If, in the pullback, it hits upside reaction areas and holds SHORT momentum and bias then you don't argue with the chart.
On 05 JAN 2023 Bitcoin turned MOMENTUM Long. On 11 JAN 2023 the Day chart went from BIAS short to BIAS Long.
This area and slightly above on the 4D chart would be the swing trade profit areas and the highest probable areas for entering a FADE Short position.
The Entry Reaction Zones
Note: Given the range from this week's open you really don't want to see a week open test. If so it better reject quickly. Watching the 30m chart if this happens will be key.
Also, the RDA is between the fast and slow momentum indicators. That might just be the best entry if there is a pullback momentum check.
The Daily chart provides these levels:
- Fast M Check - 18,630 area
- RDA - 18,160 area
- Slow M Check - 17,640 area
How I Trade This With My System (as seen on chart)
On top of those areas, I would define reaction areas based on levels using the RD Level Rules.
With the Daily reaction areas and levels defined, I then decide on my primary timeframe.
I like the 60m combined with looking at the 30m for structure. For instance, as I write this the 60m RDA is sitting right at 19K. The slow momentum is at 19,4.
More aggressive reaction areas to go long are at these areas I just mentioned.
In these areas, there will be a reaction; how big and if momentum and bias will remain long on the 60m chart is unknown. Looking at 5m and tick charts will reveal when and if price gets there.
Also, you don't want to see the 60m VC range that lasted 22h between 18,770 to 19,080 to be closed below more than 2-3 60m candles. For a continuation of momentum long if this area is tested you want to see that buyers are stepping up on the test.
Risk and Stop Losses
Pretty obvious here. The "protection" stop loss is 16,730, well below the weekly open. This allows for weekly open test overshoot a bit.
For a more managed stop loss placement, I'd use the 60m chart. I'd check in 2-3 times a day. When the momentum on the 60m chart shifts from momentum long to momentum short you now have your upside level. From there, it's really looking at the volatility of those moves. Also, combining with the 30m chart will provide correlating zones.
The bottom line is if you are looking to go long on a pullback other than a quick downward move that you can watch on the 5m chart to find buy support, you're going to have to watch how the 60m momentum plays out. If, in the pullback, it hits upside reaction areas and holds SHORT momentum and bias then you don't argue with the chart.
Note
Low vol overnight. Sellers or at least short term sellers still holding. Also, playing a role is short sellers who have no idea how to short or properly fade. Fades are the hardest trades to execute but time and time again you see liquidations in areas where it makes zero sense to fade.Here is an updated pullback range on the 60m chart:
Here is the structure chart:
Those yellow extreme bands of the RDA are typically great areas to look for entries and profit areas.
Note
Based on the 5m chart, the 20,200 area appears to be the best area to go long. This aligns with a few other timeframes.Simple way to set this up. Plan 4-5 scaled in entries. One at the zone, one in the zone, and one below the zone.
Then 2 more in the 19-20K range.
You'd execute this strategy if you believe this next week will see follow thru long momentum. Close below 19,200 might put a ding in that scenario.
Note
NO major pullbacks, so the areas defined haven't been tested. When BTC behaves like this where it's not breaking the fast or slow momentum then using the 15m chart for entries works well.That is for swing trades. The price action tomorrow after the cash markets open and close will reveal if there is true follow thru here.
As far as current price action:
5m just above vwap, held ydays vwap, staying above with momentum and bias indicators catching up probably mean highs are target:
Note
You've really had to be aggressive on the long entries. Similar to ETH the value channel (VC) aligns well with proper excess.
60m bar going up into the upper excess bods well for at least a test of the high.
Note
To get the best view of my thoughts on BTC following this idea and the upside rejection one would be best:
The red box is an outline of the Daily time frame momentum and bias checks for a continuation of long.
Price is below the week open.
The 60m chart is both bias and momentum short. What needs to happen for this to change?
Weekly open has to be captured, retested and hold. 60m needs to close above the RDA. Otherwise the best trades are momentum long trades off daily timeframe.
Get the best... join my Discord: discord.gg/WgjsxVz
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.