Bitcoin near the end of consolidation

A drop ensued after hitting the critical resistance zone mentioned in the last update. However, there was no follow through after the drop. Instead, the market starts to climb up slowly again.

At this moment, price actions still favour the bulls but it certainly does not mean that you should buy near the resistance level. Buying at resistance is never part of my trading strategy as it does not give me an edge over the market.

From the above chart, you can see the uptrend line is still intact while the price is lingering just below the critical resistance zone @ $10200. This usually means the market is about to decide its direction soon. Whether it will break up or down we do not know. What we can do is to prepare ourselves for possible scenarios.

According to my trading system, I will consider to take the trade if price follows either of the two scenarios on the above chart (blue or red). The critical zone for the bulls to hold is still at $8,400 on the daily timeframe. If the sellers can CLOSE the daily timeframe below $8,400 then the next significant support is @ around $6,200.

From an investment perspective, I have decided to cancel the 5% buy order @ $7,700 and move it to $6,200. This means I am going to use 15% of my account size to buy @ $6,200, leaving 40% cash.

Bitcoin still in consolidation on the weekly timeframe:

Chapter 1: 1% rule
Chapter 2: How to calculate position size?
Chapter 3: The Sweet Spot
Chapter 4: Scalability

Taiwan_Bear

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.