Bitcoin Daily Update (day 225)
I believe that it is possible to beat the market through a consistent and unemotional approach. This is primarily achieved through preparing instead of reacting. Click here to learn more about how I use the indicators below and Click here to get my complete trading strategy! Please be advised that I swing trade and will often hold onto a position for > 1 month. What you do with your $ is your business, what I do with my $ is my business.
My most recent Bitcoin Bubble Comparison led to the following predictions: 1 day - 14 days = < $5,750 | bottom prediction: $2,860 by 10/30
Previous analysis / position: “I do expect a small bounce off the first test of the phase 2 hyperwave trendline. A return to $6,400 to test that area for resistance is the most logical result” / Short BTC from $6,330.50 | Short ETH:USD from $197.02
Patterns: Descending triangle | Phase 2 hyperwave
Horizontal support and resistance: $6,200 was support and is currently being tested for resistance | S: $6,250 - $6,178
BTCUSDSHORTS: Massive triangle starting to form. If daily candle closes above 39,750 then the target is 60,959.
Funding Rates: Longs pay shorts 0.01%
12 & 26 EMA’s (calculate % difference): 12: -3.24% | 26: -4.46%
50 & 128 MA’s: 50: -6.09% | 128: -7.61%
Volume: Last sell off had largest volume on the 1h chart since April 12th and that was the day that set the record for most spot BTC purchased. That indicates to me that some big buyers are getting scared / starting to exit.
FIB’s: Testing 100 level. 1.618 = $3,663 when using May 5 high
Candlestick analysis: 1 day bullish spinning top
Ichimoku Cloud: Kijun-Sen at $6,476 (daily) should act as resistance. 10 minute cloud has actually been very helpful over the past day or so. Was strong support at $6,239 that is thinning and we just got a bearish kumo twist.
TD’ Sequential: 4h R2 currently = R1 if that falls below then I think it would be a pretty good entry.
Visible Range (1 month lookback): High volume nodes from $6,383 - $6,590 should be strong resistance
BTC’ Price Spreadsheet: 12h: +/- 0 | 24h: +8.04% | 1w: -4.75% | 2w: -5.28% | 1m: -0.82%
Bollinger Bands: Last candle failed to return to the band. I expect to see a bulge very soon (as does everyone paying attention)
Trendline: Phase 2 hyperwave and bottom of descending triangle = $5,900. A close below that price would almost certainly lead to the bulge.
Daily Trend: Chop
Fractals: Down: $6,100 | Up: $6,712 (5 in that area) I do not expect up fractal from September 14th to be violated at $6,589
On Balance Volume: Has broken down it’s descending triangle
ADX: Finally bouncing after creating 4 year low
RSI (14 setting): W: 44 | D: 38.26 | 4h: 34.82 and testing down trend | 1h: 46 after resisting 50 just formed lower low and looking like it will create a second lower high (in line with price)
Stoch: %K starting to enter oversold territory on daily and 3d. Weekly still has room to go. 4h making bearish re cross under 25.
Summary: When the higher time frame Bollinger Bands get a super squeeze it will often be followed by a shakeout before the real trend starts. That is something I have been very cognizant of over the last couple weeks and I no longer think that this selloff could be a fakeout.
The reason being is how much time we have spent below $6,400 support. Shakeouts will usually be violate/fast and the rebound will be even more so. The price will not tend to spend much time below prior support and that will trap in the breakout traders who were waiting with stop orders.
I also think that the chances of a bounce to $6,400 are decreasing. In the Wyckoff distribution preliminary support will eventually breakdown and becoming resistance. Therefore I think a selloff to $5,900 and then a bounce back to $6,175 is the most likely outcome. From there I would expect the selling climax to follow.
$6,250 - $6,275 is the number to be watching. If not in a position then a stop order at $6,149 should be a good option. That would also be in line with the red 2 trading below the red 1 on the 4 hour chart if it were to occur in the next 2 hours.
That being said there is still a very decent chance that we bounce from here and retest $6,400 - $6,500. If that happens then be prepared to enter a short. I believe that would be the most favorable entry in terms of risk:reward. $6,651 should be a safe area to set the stop loss with all of those up fractals lining up.
Keep in mind that there is a significant premium on USDT exchanges (currently 1.21%). The prices above are an average of both and would need to be adjusted for your exchange accordingly.
My most recent Bitcoin Bubble Comparison led to the following predictions: 1 day - 14 days = < $5,750 | bottom prediction: $2,860 by 10/30
Previous analysis / position: “I do expect a small bounce off the first test of the phase 2 hyperwave trendline. A return to $6,400 to test that area for resistance is the most logical result” / Short BTC from $6,330.50 | Short ETH:USD from $197.02
Patterns: Descending triangle | Phase 2 hyperwave
Horizontal support and resistance: $6,200 was support and is currently being tested for resistance | S: $6,250 - $6,178
BTCUSDSHORTS: Massive triangle starting to form. If daily candle closes above 39,750 then the target is 60,959.
Funding Rates: Longs pay shorts 0.01%
12 & 26 EMA’s (calculate % difference): 12: -3.24% | 26: -4.46%
50 & 128 MA’s: 50: -6.09% | 128: -7.61%
Volume: Last sell off had largest volume on the 1h chart since April 12th and that was the day that set the record for most spot BTC purchased. That indicates to me that some big buyers are getting scared / starting to exit.
FIB’s: Testing 100 level. 1.618 = $3,663 when using May 5 high
Candlestick analysis: 1 day bullish spinning top
Ichimoku Cloud: Kijun-Sen at $6,476 (daily) should act as resistance. 10 minute cloud has actually been very helpful over the past day or so. Was strong support at $6,239 that is thinning and we just got a bearish kumo twist.
TD’ Sequential: 4h R2 currently = R1 if that falls below then I think it would be a pretty good entry.
Visible Range (1 month lookback): High volume nodes from $6,383 - $6,590 should be strong resistance
BTC’ Price Spreadsheet: 12h: +/- 0 | 24h: +8.04% | 1w: -4.75% | 2w: -5.28% | 1m: -0.82%
Bollinger Bands: Last candle failed to return to the band. I expect to see a bulge very soon (as does everyone paying attention)
Trendline: Phase 2 hyperwave and bottom of descending triangle = $5,900. A close below that price would almost certainly lead to the bulge.
Daily Trend: Chop
Fractals: Down: $6,100 | Up: $6,712 (5 in that area) I do not expect up fractal from September 14th to be violated at $6,589
On Balance Volume: Has broken down it’s descending triangle
ADX: Finally bouncing after creating 4 year low
RSI (14 setting): W: 44 | D: 38.26 | 4h: 34.82 and testing down trend | 1h: 46 after resisting 50 just formed lower low and looking like it will create a second lower high (in line with price)
Stoch: %K starting to enter oversold territory on daily and 3d. Weekly still has room to go. 4h making bearish re cross under 25.
Summary: When the higher time frame Bollinger Bands get a super squeeze it will often be followed by a shakeout before the real trend starts. That is something I have been very cognizant of over the last couple weeks and I no longer think that this selloff could be a fakeout.
The reason being is how much time we have spent below $6,400 support. Shakeouts will usually be violate/fast and the rebound will be even more so. The price will not tend to spend much time below prior support and that will trap in the breakout traders who were waiting with stop orders.
I also think that the chances of a bounce to $6,400 are decreasing. In the Wyckoff distribution preliminary support will eventually breakdown and becoming resistance. Therefore I think a selloff to $5,900 and then a bounce back to $6,175 is the most likely outcome. From there I would expect the selling climax to follow.
$6,250 - $6,275 is the number to be watching. If not in a position then a stop order at $6,149 should be a good option. That would also be in line with the red 2 trading below the red 1 on the 4 hour chart if it were to occur in the next 2 hours.
That being said there is still a very decent chance that we bounce from here and retest $6,400 - $6,500. If that happens then be prepared to enter a short. I believe that would be the most favorable entry in terms of risk:reward. $6,651 should be a safe area to set the stop loss with all of those up fractals lining up.
Keep in mind that there is a significant premium on USDT exchanges (currently 1.21%). The prices above are an average of both and would need to be adjusted for your exchange accordingly.
emasar Indicator is available for purchase at alphanalysis.io/product/emasar/
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