BTCUSD - When to top up
I'm a big believer in BTC long term and whilst it's likely to correct, I'm holding my position. This post is not about shorting or selling as I just wouldn't want to bet against this market. It is about trying to identify the right time to top up.
It is interesting how two different time frames can show two very different pictures. The hourly chart shows a parallel or upward flag forming with support pushing back any drops. RSI has moved into neutral territory. This might suggest to top up now.
On the other hand, looking at the bodies of the candlesticks, the daily shows a continued upward trend with yesterday being just a 'small blip'. However the RSI is showing overbought at 79 and close to 80. BTCUSD has had a close between 80 and 81 four times in the past five months, each time a consolidation followed. Even with all the positive momentum and 200k+ Coinbase customers per day, this suggests a consolidation is due.
So where will it go?
Take a look at this table.
https://i.imgur.com/AMVF4t4.png
In the last five months, we typically see a drop of around 9% the next day. This is then followed by a low, on average, 9 days later of 19%. However, breaking those down, we can see that excluding the 14 Aug and 14 Oct, the average drop was 31%.
Given the risk of a significant correction at this stage, I'm ignoring the 9% drops. I'm keen to get in if we see a correction similar to Sept and Nov. I'll spread my buy in so I don't miss an opportunity or buy in too high. The table above shows how I spread this to get an average buy in of 24% down (7,938) from the high on the wick of candle on the day close of RSI 80+. I have assumed this to be 10,500 but will adjust as events unfold.
If this correction doesn't happen, great, I'm in long term, so I'm happy either way. I just dont want to top up too early or miss an opportunity to do so.
Cheers monkia
p.s. I recently came across tradingview and thought, why not share these so I can get opinions, feedback and challenges to these ideas. So all feedback welcome!
It is interesting how two different time frames can show two very different pictures. The hourly chart shows a parallel or upward flag forming with support pushing back any drops. RSI has moved into neutral territory. This might suggest to top up now.
On the other hand, looking at the bodies of the candlesticks, the daily shows a continued upward trend with yesterday being just a 'small blip'. However the RSI is showing overbought at 79 and close to 80. BTCUSD has had a close between 80 and 81 four times in the past five months, each time a consolidation followed. Even with all the positive momentum and 200k+ Coinbase customers per day, this suggests a consolidation is due.
So where will it go?
Take a look at this table.
https://i.imgur.com/AMVF4t4.png
In the last five months, we typically see a drop of around 9% the next day. This is then followed by a low, on average, 9 days later of 19%. However, breaking those down, we can see that excluding the 14 Aug and 14 Oct, the average drop was 31%.
Given the risk of a significant correction at this stage, I'm ignoring the 9% drops. I'm keen to get in if we see a correction similar to Sept and Nov. I'll spread my buy in so I don't miss an opportunity or buy in too high. The table above shows how I spread this to get an average buy in of 24% down (7,938) from the high on the wick of candle on the day close of RSI 80+. I have assumed this to be 10,500 but will adjust as events unfold.
If this correction doesn't happen, great, I'm in long term, so I'm happy either way. I just dont want to top up too early or miss an opportunity to do so.
Cheers monkia
p.s. I recently came across tradingview and thought, why not share these so I can get opinions, feedback and challenges to these ideas. So all feedback welcome!
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