Bitcoin (BTC) - A Road Map For Trading
Updated
Good afternoon traders! Today, I'll give you a more technical chart, but I will continue to update the magnet chart soon.
Technicals are saying we should see a retrace with lower volume and a hidden bearish divergence, but the selling volume/selling pressure isn't there yet. Bulls went into hibernation on this rally.
If you've been following my magnet charts, you'll see that Bitcoin rallied 30%, with volume increasing after a small consolidation and a shallow retrace before moving higher.
That chart was not without merit though as it was backed by very solid TA (that was shared in the my private trading community Signal Profits, that I'll share with you now.
First off, we were sitting on the weekly 200MA as you can see in my magnet post, which typically gets a strong dead cat reaction bounce.
Secondly, we had a 3 day TD9 buy candle (tom demark sequential). There have only been 2 in 2018 and both of them were massively bullish for nearly 40-60% gains on Bitcoin.
We also had a bullish divergence on the daily with the RSI, which also has had only two other occasions in 2018, both with massive returns.
Lastly, we had a rising wedge on TUSD that looked to be breaking down with lower volume, which has an inverse correlation to Bitcoin.
Based on VPVR, there are 4 strong overhead resistances that line up with the fibonacci levels form the swing high and swing low.
We have hit a double top on the daily chart, so this may also be a good time to hedge short, but I may wait a little bit more or until I see at least the 10MA fail as a support on the 4 hour and then will add to it if the 200MA breaks.
The $4500 zone is the place I'm looking to take profits, but will keep my stop loss trailing, and If the bulls are able to push price higher than $4500, $4859 at the 50% fibonacci level is the next strong resistance with a strong volume node to back it up.
If the 50% fib level breaks, then I think the last resistance and the strongest to hold the price back is the .618 fibonacci level, which stands in the way at the $5254 levels.
We are not out of the woods yet, and if the price decides to retrace, we may look to the $3890 and the $3600 levels as potential supports to make a higher low on the longer time frames.
The weekly 200MA still stands as a very strong support on break of new lows, which could very well still happen as we continue to build this base after a VERY long bear market cycle.
This is a great time to start buying for your long term holdings as I've been recommending everyone to do, especially when price dropped below $3300.
The halvening is coming up in 2020 along with Fidelity and Bakkt and several other big products (like an ETF) are coming to crypto soon.
We are also seeing stocks take a massive beating as the crypto markets rebound against a falling market. This was something I predicted back in October when I called the tops of all the equities markets like the Dow Jones, S&P 500, Apple, Amazon and Netflix.
We may be seeing that scenario playing out right now, but it's important to stay focused on the here and now as a trader.
As a long term investor in cryptocurrency, this is EXACTLY the type of correlation you want to see.
The last thing I want to leave you with is this chart... Play VERY close attention to it.
If this wedge breaks to the upside, we may see the alts (most likely low priced majors) shift strong to the upside. This means that Bitcoin dominance needs to fall and altcoin market cap needs to rise.
Part of the strategy we've been playing in my private trading community is to scale into alts like TRX and ADA, but XLM may also be a good one.
Thanks for reading and if this helps you, the only thing that I ask is that you like the chart and give me a comment below.
Technicals are saying we should see a retrace with lower volume and a hidden bearish divergence, but the selling volume/selling pressure isn't there yet. Bulls went into hibernation on this rally.
If you've been following my magnet charts, you'll see that Bitcoin rallied 30%, with volume increasing after a small consolidation and a shallow retrace before moving higher.
That chart was not without merit though as it was backed by very solid TA (that was shared in the my private trading community Signal Profits, that I'll share with you now.
First off, we were sitting on the weekly 200MA as you can see in my magnet post, which typically gets a strong dead cat reaction bounce.
Secondly, we had a 3 day TD9 buy candle (tom demark sequential). There have only been 2 in 2018 and both of them were massively bullish for nearly 40-60% gains on Bitcoin.
We also had a bullish divergence on the daily with the RSI, which also has had only two other occasions in 2018, both with massive returns.
Lastly, we had a rising wedge on TUSD that looked to be breaking down with lower volume, which has an inverse correlation to Bitcoin.
Based on VPVR, there are 4 strong overhead resistances that line up with the fibonacci levels form the swing high and swing low.
We have hit a double top on the daily chart, so this may also be a good time to hedge short, but I may wait a little bit more or until I see at least the 10MA fail as a support on the 4 hour and then will add to it if the 200MA breaks.
The $4500 zone is the place I'm looking to take profits, but will keep my stop loss trailing, and If the bulls are able to push price higher than $4500, $4859 at the 50% fibonacci level is the next strong resistance with a strong volume node to back it up.
If the 50% fib level breaks, then I think the last resistance and the strongest to hold the price back is the .618 fibonacci level, which stands in the way at the $5254 levels.
We are not out of the woods yet, and if the price decides to retrace, we may look to the $3890 and the $3600 levels as potential supports to make a higher low on the longer time frames.
The weekly 200MA still stands as a very strong support on break of new lows, which could very well still happen as we continue to build this base after a VERY long bear market cycle.
This is a great time to start buying for your long term holdings as I've been recommending everyone to do, especially when price dropped below $3300.
The halvening is coming up in 2020 along with Fidelity and Bakkt and several other big products (like an ETF) are coming to crypto soon.
We are also seeing stocks take a massive beating as the crypto markets rebound against a falling market. This was something I predicted back in October when I called the tops of all the equities markets like the Dow Jones, S&P 500, Apple, Amazon and Netflix.
We may be seeing that scenario playing out right now, but it's important to stay focused on the here and now as a trader.
As a long term investor in cryptocurrency, this is EXACTLY the type of correlation you want to see.
The last thing I want to leave you with is this chart... Play VERY close attention to it.
If this wedge breaks to the upside, we may see the alts (most likely low priced majors) shift strong to the upside. This means that Bitcoin dominance needs to fall and altcoin market cap needs to rise.
Part of the strategy we've been playing in my private trading community is to scale into alts like TRX and ADA, but XLM may also be a good one.
Thanks for reading and if this helps you, the only thing that I ask is that you like the chart and give me a comment below.
Note
38.2% was the bounce point along with the 200MA on the 4 hour as pointed out in the analysis above.
Note
We are also seeing a head and shoulders form on the 4 hour along with that potential bear flag.Looking for a potential re-entry at that 61.8%-78.6% zone from this recent move.
$3550-$3650.
Note
Bearish div on the RSI hourly and a symmetrical triangle is forming. New Analysis provided.
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