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Bearishmomentum

LTCUSD: Mid 150's More Attractive For Buying Opportunities.LTCUSD update: The fact that the 164 resistance was taken out is a very bullish sign for this market over the longer term. This old resistance is likely to become a new support, but the mid 150s offer a more proportionate level for a buying opportunity. With the bullish trend line clearly intact, this market intends to go higher, but buying too early can bring more pain than expected. The 156 support is the .382 area of the recent bullish swing and offers a predetermined level to watch for swing trade long opportunities. The previous candle low came as close as 157 which provides evidence that this level is attracting significant buying activity. It is a matter of waiting for the price action to fit the criteria of one of our buy signals at S.C. And if the market goes higher without such a signal, then we are perfectly fine with missing a move. Optimal reward/risk is a much higher priority when it comes to evaluating an opportunity. In summary, this market is poised to go higher in the long run, but in order to participate, it needs to provide a price structure and setup that fits sound risk/reward criteria. Keep in mind, 190 is the next reversal zone boundary which means not only is that a potential exit, but it is also an area to avoid initiating any new longs. Using predetermined levels to anticipate a particular market action is part of the best practices that we adhere to when generating signals at S.C. Speculating in any financial market is more than just making decisions based on information evaluated on a chart. Self awareness and emotional intelligence are also part of the speculative process whether you are managing a portfolio or individual trades. It is this type of insight that you will find on S.C. only. Questions and comments welcome.
BITFINEX:LTCUSD
by MarcPMarkets
7
EURUSD: Bearish Momentum Can Lead Price Back To 1.1760s Area.EURUSD update: Price is attempting to stabilize at the 1.1933 level which is an old resistance / new support level while showing a bullish pin bar in the process. With momentum being decisively bearish, there is not enough structure at this level to justify any long swing trades. When momentum is decisive in one direction, usually any attempt to stabilize turns out to be a trend continuation pattern. The narrow range that price is trying to carve out at the moment appears to be just that, the beginnings of a trend continuation formation. This is especially important to observe since the next significant support level is the 1.1764 reversal zone boundary which is 200 pips lower. I would not look for longs here until price is much deeper into the reversal zone and is presenting a clear reversal structure which is it not doing at the moment. A pin bar is not a structure, it is just a single bar and not enough to justify taking any risk on the long side. If price does happen to bounce, the 1.2100 level (.382 of current bearish swing) is where we would anticipate the next actionable resistance to be. Shorting on a break of the current continuation pattern is a consideration, but would be an aggressive choice since this market is not in any type of resistance zone. As I always remind forex traders, these markets are heavily tied to the fundamental outlook of economic variables like interest rates. Any macro economic variable that has an effect on interest rates will sway the sentiment of major pairs like this one. It doesn't hurt to be aware of fundamental drivers that are putting pressure on a pair like this, but always look for the technical side to line up. If instead, the technical perspective is doing the complete opposite, which is not the case yet, then a fundamental shift may be in process that will show up on the charts before it does any where else. Do not discount the charts, because they often reflect fundamental changes before you hear about them anywhere else.
by MarcPMarkets
1
POSSIBLE DOUBLE TOP SPOTTED. LAST BULL TRAP BEFORE FALLHi, trading View, So far so good, my last chart is smooth as it has already two red candles signaling the volume loss, and where it is heading. But, the Moving Water just spotted a possible double top, before the big fall, and price could go up to 9.750, with this formation. For more information check the related charts below. Feel free to: comment, suggest better ideas, ask questions inbox, help me improve, post a better chart on the comment, and GIVE A LIKE or FOLLOW. GOOD LUCK. GOOD PROFIT.
BITFINEX:BTCUSDShort
by EDWARDCASHTRADER
151
GBPUSD: Key Support Zone In Play But No Long Trigger. Yet.GBPUSD update: A strong dollar move pushes this pair into an attractive support level as price attempts to find some stability. If it can trigger a long, it will be very important to be proactive when it comes to position management. The key level here is the 1.3551 which is the reversal zone boundary relative to the 1.3712 range low. This means price is within the reversal zone but has not generated a long signal. Bearish momentum and some fundamental variables weigh against this market, but that does not mean it can't retrace before going lower. The most likely target for a long from an area like this is the 1.3887 level (.382 of current bearish swing). Since so much is working against this market, I would use an even more conservative target if a long is triggered just to increase the chances of a successful exit. Overall this market is testing the low of a broad range. What is important to consider is that the long term Elliott Wave count is bearish which means holding onto longs is not favorable. Taking a trade against the bigger picture does carry more risk, but for swing trading purposes, if the short term probability favors a move that is worth more than 100 pips, I would be willing to take the risk. If a trade is triggered, it will be highlighted on S.C. only. As of right now, we are still neutral on this market.
by MarcPMarkets
1
EURUSD: Bearishness Into Range Low? Waiting For Reversal.EUR/USD update: I am writing about this market in particular because I called a long swing trade yesterday evening that got stopped out. Those of you who are on S.C. most likely saw the signal in your email. Unlike others, we embrace losses and learn from them. In this report I am going to highlight one idea that would have been better for this situation. The trade was: Long 1.2133 Stop 1.2085 Target 1.2190. What was the problem? This trade was taken on a daily pin bar signal. Often these type of signals need breathing room. In other words, price tends to retrace partially or fully after the signal which occurred at the break of the pin bar high (1.2133). The best way to capitalize on this is to split the position in half. Buy half on the break, and place a limit order at some proportional amount lower to take advantage of a situation like the one occurring now. If price never pulls back, you are in the market with a smaller position, but at least you are in. If the market retraces and fills the other half of your order, now you have a lower average price which will allow you to use a wider stop. Either way, this would be better than all in, all out because your risk is basically the same while giving the market more room to breath. If I had placed the stop below the pin bar low, this trade would still be active. If the market reverses back up which has higher probability at these levels, I would still be in. From a technical standpoint, this market is still fluctuating around a very important level. The 1.2080 level is the range reversal zone boundary. If it holds here and mounts a reversal, 1.2195 is the first resistance (.382 of recent bearish swing). This is the conservative target since a move off of the range low has the potential to reach the 1.2279 to 1.2383 resistance zone (.618 of recent bearish swing). If another trade signal goes off, I will send out more specific instructions on how to enter the trade based on what I wrote above, but it will only be available on S.C.
by MarcPMarkets
4
GBPUSD: Range Low Offers Potentail Long On Horizon?GBPUSD update: Price has broken below the nearest reversal zone boundary at 1.3988 and closed weak. It has also shifted the bullish trend line which means it is best to avoid this market until it stabilizes in the near term. Trend lines serve as a visual guide for potential reversal levels in the future. When a trend line is broken and needs to be adjusted, it can be confusing. Is it a trend change? In this case, no, it is indicating that the broader bullish momentum is slowing (as slope becomes more horizontal). In order for this trend line to offer any value, price needs to establish a reversal off of it now, and then any retest in the future is what we want to watch closely for a higher probability setup. The key level that is in play now is the 1.3551 reversal zone boundary. This level represents the extreme range low and if a reversal pattern can materialize in this area, that would offer a high probability swing trade long scenario. It all depends on the price action. As you can see, when price reached the 1.3988 area which offered potential, a reversal pattern could not materialize for a swing trade. This is why buying at a predetermined level is not enough to justify taking risk. The predetermined level must be accompanied with evidence that buyers are actively absorbing sell orders. This activity is expressed in particular candle patterns which is what we look for at S.C. in order to issue a signal. Many traders attempt to interpret fundamentals when it comes to the forex market. There is nothing wrong with that if you are into that sort of thing, but through TA I am able to arrive at the same conclusion, often faster, without having to pretend to have a PHD in macro economics. Price discounts all known information in the world at the present time which means the fundamentals are often reflected in the price action and why chart analysis offers substantial value, especially on the short term. As this market attempts to push its range low of 1.3712, we will be watching for reversal patterns that have the potential to offer a trade scenario that can see price retest the 1.4100 area which is the middle of the range. Check for updates and longer time frame Elliott Wave counts on S.C.
by MarcPMarkets
9
ETHUSD: Retrace Can Test 575 Or Lower Before Higher High.ETHUSD update: Price is retracing into the first trend line quickly while taking out the 643 previous candle low. The 590 area is the location of the trend line and is one level to consider for a bullish reversal, but 575 is the level that carries higher probability. Trend lines are useful when it comes to evaluating context, even when they break. A break does not signal a trend change, but it does signal a change in momentum. The key to evaluating a trade opportunity at a predetermined level like a trend line is the price action which can be analyzed through candle stick formations. The current candle at the moment implies further weakness so until it proves otherwise, it is reasonable to expect the first trend line to break. The more attractive level is the 575 area which is the .382 of the recent bullish swing. The best formation to see in this area is a failed low where price attempts to bounce, fails and attempts to go lower and then fakes out again with something like a bullish pin bar. Keep in mind price can go as low as 545 in this scenario and generate a bullish reversal for a swing trade long. IF price continues to retrace and compromises these levels, the next area to consider is the 493 to 434 support zone (.618 of recent bullish swing). Again, the formations at that time will allow for a trade opportunity or not. When a signal is generated, along with an attractive reward/risk ratio, and reasonable premise based on context, we email, text and also publish the details to our tracking spreadsheet on S.C. In summary, a pull back off of a high is normal and healthy. There is no need to get dramatic or hypersensitive which are characteristics of the herd. This price action is the reason why we always say don't buy the highs (unless there is a very well defined setup like we just had in BTC). This retrace can be the test that these markets need to prove that a bottom is truly established which can lead to a broader move higher in the long run. Know your levels and let the market prove itself at those levels, otherwise there is no reason to justify any new positions. Questions and comments welcome.
BITFINEX:ETHUSD
by MarcPMarkets
8
EURUSD: Middle Of A Consolidation Is The Best Place To Be Flat.EURUSD update: Price has rejected the 1.2379 to 1.2418 resistance zone and has retraced back to the 1.2268 to 1.2220 support zone while breaking a long term bullish trend line in the process. Is now the time to get short? Never trade the middle. If you examine the price history of this market since January, you will see that it is clearly in a range bound environment. As price gyrates between the two converging trend lines, it may be tempting to take trade signals simply because one appears. That is not a good idea because as I have written before not all signals are created equal. There is a high degree of randomness in any financial market and our job as a price action trader is the minimize randomness in order to improve our chances of a profitable outcome. The middle of any range bound market is the MOST random area for price action. Essentially, price can go either way from this middle and there is no reliable or consistent way to gain an advantage. Price at the moment is gyrating in the middle of this large range. Even if it appears to be going lower, anything can happen at the current level. The 1.2268 to 1.2220 (.618 of recent bullish structure) serves as a reference point to consider longs, but if I am going to take risk, I want the probability to be most in my favor. In this context, the best area for the most potential would be the 1.2181 level. This is the reversal zone boundary relative to the 1.2214 low. This is where the likelihood of a fake out is the greatest. Remember when it comes to trading the forex market, I am very short term. I am only interested in day trades or swing trades. 30 to 50 pip targets are reasonable on this time frame. Taking these profits while they are available is key because there are too many economic variables that affect these markets which can rob you of your profits quickly. There is no sign of a setup at the moment, but if one appears within a predetermined level that makes sense in terms of probability, it will be posted on S.C.
by MarcPMarkets
2
LTCUSD: Waiting For The Next Buying Opportunity?LTCUSD update: Price has rejected the 150 to 161 minor resistance zone that we wrote about on yesterday's update on S.C. This move is the likely beginning of the retrace that we have been waiting for in order to enter our next swing trade long. The 150 to 161 resistance (.618 of recent bearish swing measured from the 175 high) is an area to anticipate selling. This was stated clearly in yesterday's analysis. Best practices dictate: you should be thinking "sell" at resistance levels, not initiating new long positions. We avoid buying into resistances, even if the market is strong and goes higher because we are interested in high probability. Since the herd reacts to market moves, instead of anticipating them, it is easy for them to lose sight of the long term probability of a particular outcome. Buying into highs is a low probability behavior and when it produces a profitable trade on occasion, it reinforces this ineffective behavior. When you stop focusing on the money, only then can you better see the significance of best practices and probabilities. So where is the next opportunity? The 136 level is where the immediate bullish trend line is located. This is one place to anticipate bullish reversals. The other area is the 126 to 118 support zone (.618 area of recent bullish swing). If price falls through both of these predetermined areas (ANYTHING IS POSSIBLE) then we will be looking for an extreme price zone reversal which can occur in the low 100s. In summary, the current bearish candle formation implies further weakness which is healthy and required in order to find a new long swing trade setup with attractive reward/risk. In general, these markets appear to have found some stability and may have established a long term double bottom formation which points to greater strength in the near future. The key to capitalizing on this is letting the market prove itself are predetermined levels. That means the next pull back should not push new lows, if it does then you reevaluate and adjust to the new information. You don't fight the market, you just sit back and go with the flow. Questions and comments welcome. (Visit S.C. for more frequent updates across various markets).
BITFINEX:LTCUSD
by MarcPMarkets
4
GBPUSD: Attractive Location For Long, But No Setup. Yet.GBPUSD: Price is forming a pin bar on top of the bullish trend line which also happens to be in a minor support zone. This is an attractive place to look for long swing trade setups or to lock in profit on shorts. The 1.4131 to 1.4065 zone (.618 of recent bullish swing) is a lower risk area to participate in this market which is somewhat bullish on the short term. The big picture is a different story (See Elliott Wave count on S.C.). Also the fact that price has rejected the 1.4325 level so dramatically begins to establish a very broad lower high (below 1.4500 level). This is in line with the general bearish outlook on the weekly time frame. With that being said, taking a swing trade long is still possible, it is just that profit expectations need to be within reason since the long side is limited in terms of potential. At the moment, IF a swing trade setup develops, a target below the .14200 makes more sense compared to expecting a new high over 1.4300. Also keep in mind, even though there is a sign of a bullish reversal on this chart, the market has about 12 hours before the candle closes. This means it can still close weak and the pin bar can disappear. I will be watching the Sunday night candle to determine if a long swing trade setup is present or not. Updates available on S.C. only.
by MarcPMarkets
LTCUSD: Less Structural Progress Is A Sign Of Weakness?LTCUSD update: This market rallied off the double bottom along with the BTC squeeze, but is not holding up well compared to the other major coins. While BTC took out some key resistance levels during the dramatic bullish move, this market has not. This relative weakness may be a problem if the next BTC retrace returns to proportionate support levels. I do not get into why LTC is lagging in terms of fundamentals (that's Andrew's specialty), all I know is price is lagging which can be a reflection of internal problems that will eventually surface in the fundamental research. What stands out is that fact that price could not break the 134 resistance level (.382 of recent bearish structure). Until it does, it is more reasonable to anticipate a retest of the 109 low or 102 extreme support boundary if BTC experiences a proportional retrace which could be 1K points. The one minor bullish sign that this market is presenting is the newly established trend line which can also act as a support level as this market settles. IF price retraces to the 118 level which is a reversal zone boundary relative to the 137 recent low, that is an attractive area to anticipate bullish reversal formations. Since this market is slow to break the required resistance levels to prove its strength, I would either be extremely conservative if a buy signal appears, or avoid this market all together and trade something with clearer structure. In the bigger picture this market is still poised to go higher, its just that the short term structure is not impressive in comparison to the other major coins. In summary, if you are a long term holder, there is no reason to make any adjustments yet. I just would not aggressively add until the price structure starts to show clearer signs of strength. Maybe this market will play catch up for whatever reason. There is no simple explanation for why this market is lagging, but as a price action trader, I am not concerned with why. It either fits my criteria for a swing trade, or it doesn't. If it doesn't, there are plenty of other markets to discover new opportunities in. This is why we cover a wide range of markets on S.C., not just the coins. Questions and comments welcome.
BITFINEX:LTCUSD
by MarcPMarkets
19
EURUSD: Avoid The Middle, Wait For One Of These Levels.EURUSD update: This market is in a clearly defined range between the 1.2150 low and 1.2550 high while the big picture is still bullish. Traders often put too much weight on fundamentals while participating on the smaller time frames and this is a mistake. Short term ranges like this one offer day trade and swing trade opportunities both long and short. The key is having profit expectations that are in line with the technical structure of the market. As you can see, price fell out of the 1.2379 to 1.2410 resistance zone (.618 of recent bearish swing) upon the formation of a bearish pin bar. This should be not surprise. Since I am not short at the moment, the best I can do is wait for another setup. This can unfold upon a retest of the resistance zone again (all depends on price action in the zone). Or I can wait for a long setup within or just below the 1.2268 to 1.2220 area (.618 of recent bullish structure). 1.2181 is the reversal zone boundary which offers the most attractive area for a swing trade on the long side. Keep in mind, considering the context of the bigger picture, swing trade longs have more potential than shorts. It is this context that should govern your profit target choices. Based on the big picture (you can see the my Elliott Wave chart on S.C.) this market is poised to go higher. As long as the wave counts stay intact, I will continue to expect more from longs. A bullish break out of this broad consolidation can take this market back toward the 1.3000 area over a number of months.
by MarcPMarkets
1
BTCUSD: The Crowd Losing Interest? Time To Do The Opposite.BTCUSD update: The first bearish trend line is in the process of being compromised which is a bullish sign. The problem is, this market is becoming more sluggish than expected. As this market takes its time to form a possible bottom, it is important not to lose sight of the most reasonable possibilities. The 6970 level is where the first bearish trend line is located. You can observe from this chart that previous attempts to break above the trend line has been met with swift selling. This time, the selling (small upper wicks on current and previous candles) is not so swift. This indecisive price action can be interpreted as an absence of selling, or a quiet accumulation which has been going on for at least a week now (the previous minor upswing). You can also make the argument that this initial bearish trend line is still in play since it has not been broken with any conviction. With this in mind, price can still reasonably retest the 6204 level before mounting a reversal. In order to reduce the chances of this scenario, this market needs to clear 7492 which is the .382 of the recent bearish swing. I would consider a close above that level as a form of confirmation that bullish momentum is regaining control. Until then, I would still be open to the possibility of price retesting 6204 or even 6K. In summary, one of our authors on S.C. (Gillian) wrote about a very interesting and telling observation about the level of interest in this market. She described how the Google searches related to Bitcoin trading has dramatically declined. This is very typical of the herd mentality. The main stream loses interest, the media stops hyping about it, and the opportunity to buy at some very attractive levels goes unnoticed. In my opinion, this is the best time to build a position. Not at 12K, not at 16K or 18K. That is when the crowd will get excited to buy, and the smart money unloads their cheaply acquired inventory for profit. Less experienced investors who do not understand the concepts of market sentiment, are impatient and want this process to happen now. It can take a year. As long as the technology and ecosystem are expanding, it is just a matter of time. The best thing you can do is accumulate small, and then find the alts with the highest potential, and invest into those. That is where the growth opportunity is (did you see the OMG signal on S.C?) Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
4
BTCUSD: Slow But Still A Good Level To Buy.BTCUSD update: Price has not made a new low while breaking above the 6864 previous candle high. This is a bullish sign which is especially emphasized since a long trade was called on S.C. yesterday. Now this market needs to follow through by breaking the bearish trend line and eventually taking out the 7492 level. The next relevant resistance is at the 8090 area. The 6K psychological support is holding. The 6204 reversal boundary was never touched while price finds some support near the 6805 level which is a reversal zone boundary relative to the 7240 low. The process is slow, but the market is telling us something here. If it was majorly weak, it would not waste any time and blow through the 6K low, not hesitate. This price action can be interpreted as a decline in selling pressure, and with short interest so high, this is can lead to a serious squeeze as shorts are forced to cover and become motivated buyers. What is lacking in this market is a significant bullish catalyst. With all of the macro economic drama, it is almost like the world is not paying attention to this market at such an attractive area. Usually in situations like this, some piece of news will hit the market unexpectedly and cause a reaction. There is no way you can measure this using technical analysis. Instead, TA helps you to position yourself to capitalize on where the market is going anyway, the news just pushes prices faster. IF price closes above the bearish trend line in the low 7Ks, followed by a close above the 7490 level (.382 of recent bearish swing), then it will have a much better chance of reaching the 8091 to 8543 resistance zone (.618 of recent bearish swing). For those who are entering swing trades at the current level, the 8091 area serves as a good initial target to lock in some profit. If you are in a longer term trade, it makes more sense to wait for broader resistance levels in the mid 9Ks and above before locking in some profit (this all depends on what your average entry price is). In summary, when the mainstream loses interest in a market, which often happens after a long and drawn out unfavorable environment, it is usually a good time to invest. For anyone who remembers, back in 2013, this market reached 1K for the first time and it was quite an event. Once it reached its peak, it then spent the next 2 YEARS gyrating in an uneventful, boring market that went as low as the 200s. I remember articles being written about how this market was a failure, etc. It then went to 20K as we all know. So much for being a failure. Even though we are in a much different environment with many new factors driving this market, human nature is still the same. This market in particular is a deflationary asset, which means it has a built in bias to go higher over time. Unless something seriously changes fundamentally, I am a long term buyer, especially when the market is beat up by short sighted and reactive participants. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
39
LTCUSD:Accumulate Lightly Or Avoid, But Potential Is Attractive.LTCUSD update: Price is poised to push the 106 low as this market along with the rest of the coins continue to follow BTC's bearish sentiment. All of these markets are at attractive locations when it comes to putting on position trades but until buyers establish themselves, either stay out, or accumulate lightly. The 118 level was relevant, until price could not mount a meaningful rally and failed to break the bearish trend line. This opens the door to the failed low possibilities which would establish that the selling is drying up and set all of these markets up for a short squeeze. I have been talking about this in recent reports. A short squeeze is no different than when a market reaches its peak and falls apart. A failed low is basically a fake out. With short interest being up at record levels, the trade is too obvious. Like buying at 20K and confidently expecting 30K, in this situation the herd is shorting or exiting in anticipation of sub 100 prices. Even though all of the technical structures point to lower lows, it is important to consider the possibility of a broad double bottom which is easy to lose sight of in situations like this. The nearest level to watch is the 102 area because it is the reversal zone boundary relative to the recent 109 low. It is also sitting just above the 100 psychological support which can attract buying as well. If price closes below these levels, the 71 reversal zone boundary becomes an increased possibility. As bearish as this environment looks, I am anticipating the fake out which has not materialized yet. The most conservative action you can take in these markets in my opinion is to wait it out until stability reappears in the form of price structure. This means forfeiting these extreme low prices, and buying after price breaks above 134 and compromises the bearish trend line. If you would rather capitalize on these attractive prices, then the next best thing to do is accumulate small amounts. Cost averaging makes more sense in these markets if you are not using margin. The small amounts are what protect you in terms of limited exposure if there is a dramatic move. If you get too big too fast, as many often do, you put yourself at the mercy of the market. Do not let greed drive your actions because that makes you no different than the herd. In summary, picking tops and bottoms is no different than playing the lottery. If you can comprehend that the bottom is a process, you will be better prepared to capitalize on the extreme price moves and reversal patterns that can occur at locations like this. This market is setting up just like BTC, and what makes it more attractive is the low price and high potential. Keep in mind the next major resistance is in the low 200s and can be reached quickly if the huge short interest gets squeezed (they are forced to become buyers by their own fear, or margin liquidation whichever comes first). Participating in such a move has little to do with technical analysis, and more to do with your ability to embrace risk. The more you can afford to lose, the stronger hand you have. Questions and comments welcome.
BITFINEX:LTCUSD
by MarcPMarkets
11
BTCUSD: Broad Double Bottom Attempt At 6K Support?BTCUSD update: Bearish trend line stays intact as price quickly gives back it's recent gains. The 7492 level was never compromised which means a new low is very possible. The current formation can turn into one of the specific scenarios that I am waiting for to buy more and that is the failed low scenario. In my previous report, I mentioned the possibility of the scenario that is unfolding at the moment and warned against initiating any new longs at the 7400 area. I also mentioned that a market bottom is not an event, but a process. This market can still very well test the 6K low and possibly even go as low as 4559 which is the broader reversal zone boundary relative to the 6K low. The emotional and reactionary nature of this market emphasizes that possibility even more. I want to see a reversal candle like a pin bar establish itself around the 6204 area which is a minor reversal zone boundary relative to the 6425 low. If this happens, it will offer an attractive swing trade opportunity because of the well defined risk, while at the same time offering an area to add to or establish a position trade as well because of its bigger picture location. The reason why I keep bringing up that the bottom is a process is because there is no guarantee that a long signal off of this low will be the bottom. If a signal appears, I will highlight the details on S.C. only. If price falls below 6K, I will be looking for a broader reversal some where between 6K and 4559. A break below 6K will negate the current wave count that I have posted at S.C., and will signal that this market is in a much broader consolidation rather than a Wave 2 bottom. In summary, buying into these lows, as I have mentioned before, from a risk standpoint is more attractive than buying at a short term peak. The problem is momentum is still bearish and you have to be okay with taking pain (do not do this with margin). The more conservative choice is to wait for the nearest bearish trend line to be taken out along with the 7490 level (.382 of recent bearish swing). Then look for the higher low, because with that structure in place, the market will be signalling that the bears are losing control which is not the case at the moment. The current lows offers great prices, but price action says lower prices are still very possible. Which avenue you choose is dependent on your own ability to handle risk, what you can afford to lose and what your goal is (long term hold or short term trade). I am still bullish and will consider both swing trades and adding to my position IF the market can show the setup that I want to see. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
9
ETHUSD: Retrace Offers Insight Into Short Squeeze.ETHUSD update: Across the board these coins have attempted to retrace as they follow BTC's lead. Unlike BTC, this market has managed to break a bearish trend line. This is the first step toward change, but just like BTC, must meet certain criteria before it is reasonable to expect a more significant bullish move. Clearly, everything is following BTC and all have similar price action. Now that the first bearish trend line is broken, the next thing that needs to happen is the break of the 451 level (.382 of recent bearish swing). As long as this level is not compromised, bearish momentum is still in play. This is why I emphasized in my previous BTC report that it is risky to buy the initial lower high, unless you don't mind taking some pain. The pain comes in the form of the next retrace or test to see if the bears are at full capacity (market establishes a lower low). If a new low cannot be established, then that is a sign that a short squeeze is likely. Being that the short interest is at an all time high in BTC, (the crowd is never right at tops and bottoms), it is just a matter of catalyst that can turn this market around fast. Even if the 451 level does not break first, this market can still present a double bottom or failed low situation which would offer great buying opportunities in my opinion. The 374 support (old resistance/new support) and the 344 reversal zone boundary are the levels to watch for these two bullish scenarios respectively. A decent short squeeze can take this market back up to the low 500's to test the broader bearish trend line which can serve as a good potential target to measure reward/risk from. In summary, buying into lows of a bearish environment can be tricky because there is no way to know if the low is in or if this market is going to push a new low. No matter what the trend, a retrace always presents a test that can be used to gauge the strength or lack of strength of the participants that are affecting price the most. Keep in mind, not all new lows are created equal. A failed low is a condition where price goes slightly lower which makes it look like the trend is continuing, only to reverse quickly which is often a sign of hidden strength and means that there are not enough new bears joining the party. Also remember that a bottom is a process, not an isolated event, which means patience often pays in these situations. If this market is bottoming here, there will be plenty of opportunities to get in at attractive reward/risk ratios. Questions and comments welcome (to see a very broad view of this market with a wave count, see my chart on S.C.)
BITFINEX:ETHUSD
by MarcPMarkets
14
BTCUSD: Lower High To Failed Low? Or New Low?BTCUSD update: Price establishes a pin bar at 6425 which emphasizes the relevance of the 6805 reversal zone boundary. Now is when things get tricky because this market is not in the clear yet when it comes to broader bullish momentum. The 7492 resistance level is still intact as well as the nearby bearish trend line. What does all this mean? The broader bearish momentum is still intact and will be until the market proves otherwise. If you had the risk appetite to enter the market on the lows, then you got good prices in the face of total uncertainty. Buying now for that same reason presents increased risk because if the bearish momentum stays intact, you will be getting the worst prices AND having to take the pain or get shaken out if this market retests the low which is VERY POSSIBLE. This upward move, as welcome as it is, has not proven itself yet. To prove that the bears are losing control. price needs to: close above the bearish trend line and close above 7492 which is the .382 of the most recent bearish swing. IF the market can meet these requirements, that is still not enough for me to get long as a swing trade, or even add to my position trade. After the break, I want to see a subsequent higher low or failed low formation. Whether it is shallow or goes into extreme low territory near 6K, that is the move that I prefer to buy into at this point. Waiting for the higher low scenario will not give you the best prices, BUT it will help filter out buying too early. Timing this is not perfect, and it would be preferable to see that higher low initiated by another pin bar. Ultimately how you enter and what kind of risk you are willing to take is up to you. If you have no problem holding this market to zero, then buying anywhere near these lows is not a bad idea. What about shorting? From a technical standpoint if I was able to short these markets, I would consider such a level for day trading purposes only. I must reiterate, holding longer time frame shorts at these levels is extremely risky, especially when some exchanges will not let you out of your position because of a liquidity shortage during a squeeze. Shorting on a day trade basis requires a ton of attention, and a very fast decision making process in order to decisively get out if you are wrong. Not a good idea for less experienced traders. In summary, do not get sucked into the impulsiveness of these markets. From low to high, this market moved 1k points. People who do not know how to put this into perspective will look across all of the coins, see a lot of green, and proclaim, "The bottom is in!". In terms of structure, there is no evidence that suggests that the bearish momentum is losing its grip. According to the current structure in place, it is still within reason to expect a lower low or at least a retest of the low. The key to taking action is when the market does NOT do what it is setting up to do. It is setting up to establish a lower high which often leads to a lower low. If it can't make that lower low upon a retest, that is the evidence that reveals the bears are exhausted. Being that this market is in the middle of a major support zone, a failed low is a very welcome sign at such a location. I laid out the scenarios, now you must figure out your decisions in advance so that you are not reacting, you are instead following your plan. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
13
ETHUSD: Momentum Bearish But Great Time To Accumulate.ETHUSD update: This market has been relatively weak compared to the other major coins but that does not mean it has lost its long term merit. In fact, these are great prices for getting into a top coin that can be used especially for investing into much higher potential alts which are very cheap at the moment. In this market, price has fallen through all major supports, broken below all the reversal zones, and is still restrained by a well defined bearish trend line. Momentum is still bearish and even though price action is attempting to recover along with the rest of the coins in this space, it will require some patience to work with. The 374 support level is one that goes back to the previous year that happens to be an old resistance / new support area and buyers have proven to be present there. The problem is since momentum is still generally bearish, this may just be another pause before testing lower prices. There is no way to know for sure. Even in the face of such bearish momentum, I think this market offers a great opportunity to accumulate a top token that can be used to invest into other much higher potential alts. Which ones? You will have to visit S.C. to read about the ones that we like, but the question is when do you buy this coin? Just like in anything else, there is an aggressive way and a conservative way. The aggressive way is more attractive IF you are flat. People that are just getting into the game now and missed out on all the pain have a chance to buy at extreme whole sale prices. Sure prices can go lower, but I think the bigger picture reward/risk is now biased to the bullish side. Even if you are in and holding from much higher prices, it will depend on your comfort level since you are taking pain already. Buying at these lows goes beyond technical analysis and is based more on the long term view of these markets in general. In my opinion, the lower this market goes, the more of an opportunity to accumulate and build a nice inventory. The conservative way is to forfeit these low prices and look to buy after the bearish trend lines get taken out.The first trend line is around the 420 area. That scenario would signal that the bearish momentum is running out of steam. The second sign you can wait for is a close above 451 (.382 of recent bearish swing). The benefit you gain from waiting for these less attractive prices is that momentum is more likely on your side. Less pain, more gain. This is a better way to go if you have been sitting on a position and would like to wait for more favorable conditions to cost average further. In summary, on a short term technical basis, this market does not look as stable as the others, but if you are looking to use this coin as a means to invest into others, then your timing does not have to be perfect. The best thing you can do is define your goals for this type of investment which will help shape your strategy as these markets eventually stabilize and make their way back. The least effective thing you can do is react to dramatic price action, or worse over exaggerated news which has no bearing on where these markets are going in the future. Success in these markets sums up to your appetite for risk. If you are afraid to lose, you open yourself up to a greater possibility of losing. If you can afford to lose and accept it, you open yourself up to a greater possibility of winning. In other words, scared money never wins.
BITFINEX:ETHUSD
by MarcPMarkets
10
BTCUSD: Don't Pick The Bottom, Let The Market.BTCUSD update: Bearish momentum is driving price toward 6K support as this market pushes through the 6805 reversal zone boundary. Remember there is no way to pick a bottom in a situation like this. The best we can do is estimate where a reversal is likely and let the market prove itself. If the market continues to stay weak, it can go as low as 4559 before reversing. This is where risk management comes into play. I keep getting questions about why I am not shorting this market. The quick answer is I refuse to trade these markets on margin so technically, I can't short these markets. Even if I wanted to, I would only look for opportunities on a day trade basis because the risk of a short squeeze is way too high to hold on at these levels. As I have written before, this situation is no different than when this market was pushing extreme highs. I don't buy highs and I don't short lows. I have been writing about the 8171 to 4983 support zone (.618 of entire bullish structure) for weeks. As long as price stays within this broad zone, I am either looking for signals to add to my position, take shorter term swing trades long or just wait until bullish confirmation returns. I am not going to sell anything at these levels unless I am getting stopped out of a predetermined swing trade. The more conservative thing to do is wait for a reversal to confirm and the scenario that will validate this for me is a close above the 7492 level (.382 of recent bearish swing). This event would indicate there are enough buyers to compromise the immediate bearish trend line. It does not mean this market will go straight up, it simply means momentum is beginning to change. The next step from there would be a higher low formation. In summary, whether this market decides to bottom at the current level, or reverse at 6K, the conservative thing to do is wait it out and let it choose. The only way I would be buying at the current level, is if I had no position at all which is not the case. And that is where risk management comes in. I have enough of a position where if this market keeps going lower, it won't be pleasant, but I will not get shaken out. The only way I will add to this position trade is by waiting for conservative scenarios like closing above a bearish trend line. Overall, as ugly as it looks, 6K is still holding up and can be the bottoming formation that establishes a broad Wave 2 (find the weekly BTC chart on the S.C. site for more on that). Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
18
BTCUSD: 6K Level Is Attracting Buyers, But Is This The Bottom?BTCUSD update: Price is attempting to stabilize just above the 6K low which is a very important level for this market. It just so happens that the buyers are entering around the reversal zone boundary which is not uncommon. This is a very attractive area to accumulate a position, especially if you have been out of the market waiting to get back in. Is this the bottom? There is no way to pin point it, and since momentum has not changed back to bullish, it is still within reason to see price test 6K or slightly lower before a major reversal unfolds. On this chart, I manually created a symmetrical triangle that has a base at the 6K low. For me, this is a visual cue of what the bottoming process looks like. There is no precision to this, it is a cue that highlights how much time there is between the lows. As you can observe, there is over a month which for me points to the fact that selling is relatively slow, and more than likely there is more quiet accumulation going on here. This is what broad market bottoms look like in general. Can price go lower? Yes. Consider where price is. The 8171 to 4983 support zone (.618 of entire bullish structure from the 150 lows) is a wide area where there is a higher probability of price finding stability. So price can reasonably go below 6K and will still be within this zone. Beyond that, there is a reversal zone boundary at 4560 which is relative to the 6K low. So in an extreme situation, price can push into this zone, scare everyone out, and still reverse sharply. These levels help to put these extreme moves into perspective and help you to anticipate what "should" happen next IF buyers are returning to the market. IF price closes below 4560, and does not reverse over the next candle, that is a sign of a much more serious problem and where I sit back and do nothing until the market proves stability again. Often people are confused when it comes to buying now at great low prices or missing these prices in exchange for the market moving more favorably once they are in. This is a trade off. Buying lows in a weak market is a tough game to play, but it is not a bad idea as long as you are careful with your sizing, NOT using margin, and believing in the long term outlook of this market. Keep in mind, if you thought this way at 10K, and bought too much, you now know why I keep emphasizing careful sizing and risk management. It is what I like to call the inventory game, which means you are cost averaging into a market that should come back in the long run. If you would rather forfeit these lows and wait for momentum to be in your favor, then you must wait until price closes above 7581 (.382 of recent bearish swing) . That would be the first sign that momentum is changing back to bullish. In summary, this market has been drifting lower but relatively slowly in my opinion. You can capitalize on this situation and accumulate small positions and continue to add if this market reverses, OR you can take the more conservative route and just wait until the bearish trend lines are compromised. Either way, as ugly as these markets look, I have no interest in being short because for one, I do not trade these markets on margin, and for two the risk of getting caught in a short squeeze is very high just based on the location of where price is fluctuating at the moment. Know you risk, and choose the scenario that is better suited for your personality and goals. Be in a hurry to gain perspective, NOT profit. There is always opportunity somewhere and it is having a good perspective that allows you to anticipate it and capitalize on it, not chase it. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
31
BTCUSD: 6K Low Is Near. Setting Up For Double Bottom?BTCUSD update: Bearish momentum takes price as low as 6614 which is ugly for position traders, but again situations like this call for patience and perspective. The 6K low has not been compromised yet, and even if it is retested, it is very possible that a broad double bottom formation materializes. There are still quite a few technical factors that offer plenty of potential for this market to reverse from the current lows. First, keep in mind that this market is revisiting the broad 8171 to 4983 support zone. This wide range is the .618 of the entire bullish structure originating from the 150 lows. It is around 3K points wide, which means the market can test the 4983 lower boundary and still be within an attractive buying level for position trade strategies. Two additional levels are also important to consider: The 6K psychological support and most recent lowest low, and the 4559 reversal zone boundary. These levels can be used as short targets if you are courageous enough to short these markets into those levels, but I prefer to anticipate the bullish reversals instead. 6K is important because IF price finds buyers there, this market can establish a broad double bottom which offers larger magnitude profit potential (9Ks profit target area at least). The reversal zone is an area where price has a higher probability to reverse sharply if buyers intend to keep this market from falling apart. IF price closes below the reversal zone, I would steer clear of any new long positions until stability returns. At this point, if you do not have a position, or managing a small inventory, then these lows present a very attractive place to add if you can afford to be aggressive. The problem is there are no signs that indicate any strength or reversal is likely. If you are managing a decent inventory (enough to demand your attention) then the best thing to do in my opinion is wait until the bearish trend lines are compromised before adding more. For that to happen, price needs to close above the 8K and 9K levels which means you forfeit the current wholesale prices in exchange for a more favorable and supportive market environment. In summary, I have to repeat this often at these levels, do not react, instead look at the bigger picture and recognize where this market is. It may look ugly, but it is still fluctuating in a technical area where a broad bullish reversal is possible. The way to manage long positions through this is to be conservative with your inventory. If you have too much on, and you can't afford to lose it, then the only thing you can do is lighten it up to reduce risk, but keep in mind you are selling into a major low. I have been long and buying more since January for my position trade and will only add on a swing trade basis which means I will take profit on those units earlier if the opportunities present themselves. Otherwise, I will just be patient and wait for the bottoming process to play out. Based on the current structure, price can go below 6K and can become a double bottom variation or failed low which is the scenario I am anticipating. Questions and comments welcome.
BITFINEX:BTCUSD
by MarcPMarkets
17
LTCUSD: Double Bottom Territory? Wait For Reversal Patterns.LTCUSD update: Price is pushing into extreme low territory as these markets continue to sell off. As I wrote previously as ugly as they look, if you are building inventory and not using margin, then situations like this are buying opportunities. Most importantly, you must not get sucked into the hype. Selling the bottom is the natural choice for the herd, not the trader who is prepared. As bearish as things appear at the moment, BTC has not made new lows. I do not see price below 6K yet, instead it is retesting important supports. Same goes for this market, price is attempting to retest the 118 reversal zone boundary which went as low as 106 previously (twice). There are no signs of reversal so price is poised to go lower. How low can it reasonably go? Based on the 106 low, the next reversal zone boundary is the 71 level. This means price can reasonably make a slight lower low and then reverse dramatically which would appear as a failed low. So the levels to watch are the 118 area, 106, 100 (whole number) and 71 as the extreme. IF a reversal candle establishes itself around any of these levels, that can be the beginning of a broader double bottom formation. Keep in mind, as long as none of these bullish signs appear, you can use the bearish trend line that was established in February as a guide to avoiding any new longs until stability reappears. I have been wanting to call a swing trade in this market, but it refuses to break that bearish trend line, and until that happens, it is reasonable to expect bearish momentum to continue. In summary, the crowd is always wrong at tops and bottoms. We are near a bottom, do not react like a member of the herd. These weak hands are being shaken out as a result of their fear and lack of planning. If you are holding a position trade like I am, it is a matter of holding what you have and waiting it out. The only reason why this can work is because there is no margin involved (it is no different than buying physical gold or silver and stacking it). As a position trader, I'm an inventory manager. When wholesale prices are available, you add to your stack, but carefully. The way to do that in this market is to wait for the bullish signs to return. Remember I am looking at these markets from a long term perspective, I believe in their merit AND I am willing to take the loss IF they fall apart. This is why risk management through careful sizing is so important. Well thought out sizing is what helps you maintain composure in times like this as opposed to reacting to the uncertainty. Don't react, anticipate. Questions and comments welcome.
BITFINEX:LTCUSD
by MarcPMarkets
12