Bitcoin: Bear Party? Don't Ignore These Support Levels.#Bitcoin has established a new lower higher off the 7K resistance area, BUT is this a signal for bears to run rampant? In this video I explain why the following support levels should not be ignored since there is a greater probability of a higher low developing. This can be particularly insightful for those who are not sure whether staying in a long position makes sense.
We use patterns of order flow to gauge probabilities and then apply what we learn within the boundaries of our LONG only swing trade strategy. We rely purely on TECHNICAL analysis, not biased news or irrelevant opinions. Keep in mind, you do not have to agree with this evaluation, I just hope to provide a road map of potential inflection points. How Bitcoin reacts at these points will be determined by the price action unfolding at that time.
1. The fact that the key resistance at 6425 was compromised is a structural change that is NOT obvious, particularly to those who focus on small time frames. For our strategy, it means that the bearish weight presented by the recent sell off (10400 to 3800) is less. This increases that chance that the next bearish retrace is followed by a higher low or failed low, rather than a lower low.
2. The first inflection point is the 5800 level support. This is the .382 retrace relative to the recent bullish swing. This does NOT mean price WILL reverse precisely here, but it is an area where we can ANTICIPATE a change in order flow. IF Bitcoin presents the change, and provides a continuation pattern to go long, we will be prompted to share a new swing trade long idea.
3. The second inflection point is the 5K AREA. This support zone is relative to the recent bullish swing as well, which is smaller in magnitude. The key here is how price behaves IF it probes this low. If the lower boundary is cleared with little effort, THEN a lower low becomes likely. Otherwise, based on the price action at the MOMENT, it makes sense to anticipate a bullish reversal pattern in this area which will again, prompt us to share a swing trade long idea.
Timing markets is NOT about predicting, it is about anticipating and ADJUSTING. Charts can help to a point, but unless you are an insider, there is a high degree of randomness that we must always consider. In reality, the lines on a chart do not mean anything unless you ACCEPT and UNDERSTAND a key concept about how markets work: logic does NOT drive prices. This means in order to win, you must evaluate market information from a behavioral perspective.
