truecodecapital

truecodecapital

While the chart pattern has a way to go, it's interesting to look at what may happen if the chart pattern completes. We often think of the height of the head-and-shoulders pattern as significant as a predictor of the size of the drawdown that could occur if the trend reversal takes place. In this case, that size is about 55%. So, if it plays out according to...

truecodecapital

When the price breaks the 200-day moving average like it did today, sometimes we can learn something by looking at the weekly chart. Right now BTC price is re-testing the weekly SMA(50) and the daily SMA(200) moving averages. A breakdown against the 200-day is concerning, but more concerning is if the 50-week doesn't hold. The next support is around $18,800 at...

truecodecapital

BTC is breaking down against the 200-day support level intra-day today, which coincides with the 50-week support level. The next support level comes at the 200-week support on the weekly chart at around $18,200. If BTC rebounds off the 200-day/50-week support, we would expect exciting returns; but if it breaks down, we can expect more pain to come.

truecodecapital

BTC has been in a consolidation range for most of 2021, but an argument could be made that it has broken out on the weekly chart to the upside. If this idea is correct, we could re-enter price discovery move and we could see spectacular moves to the upside. If not, the trend would be invalidated by a break down back into the range.

truecodecapital

The S&P 500 is still bleeding overnight in the futures market. The breakdown of the SMA(50) along with breaking the downside of the Keltner(1.5) and Keltner (2.5) bands hints at a change in trend. It would generally be rare for such a strong market to turn on a dime, but recent pullbacks have been violently strong. The next major support would be around $4100...

truecodecapital

The first support we have is at $38-40k in the region around the SMA(50) and the weak resistance from earlier this year. If that fails, the next area of support is around $31k, which was weak support earlier this year. There is also an extremely weak area of resistance around $20k, which coincides with the ATH from the last market cycle. Finally, there is an...

truecodecapital

Note the remaining support at around $39k which coincides with the weekly SMA(50). If this level breaks down, the next viable support level is around $15k for the weekly SMA(200) or $11.5k for the last area of resistance.

truecodecapital

After covering the negative case on the daily chart, it's worth noting the bullish case on the weekly chart. The rapidity of today's decline is troublesome, but if you zoom out to the 20-week moving average, investors with a longer timeframe may find cause for optimism. If this week closes below the 20-week moving average, basically all signals are bearish, but...

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Similar setup to May 2021. A rolling over look characterized by lower lows following higher highs. This is a very common trend reversal signal for technical traders. This is reinforced by seeing it twice in the past few months. Combined with the fact that all three major SMA averages converged around $47k-$45k and the price rejected that level vigorously. ...

truecodecapital

With all three major moving averages in an increasingly more narrow range, a golden cross that just occurred, and price back above the EMA(20), BTC is looking promising! This has a similar look to May 2020. As always, if it breaks down below the red SMA(200), get defensive. Always preserve capital for another day. The market gives us too many opportunities...

truecodecapital

BTC has failed to hold all three major support at the SMA(20), SMA(50), SMA(200), so a conservative approach is warranted. BTC could still hold the 20-week moving average, but if that breaks to the downside, there isn't support until around $37,500. Be cautious.

truecodecapital

Counterintuitively, the current formation in BTC is promising. It is generally a promising sign when the major moving averages converge and right now they are in about a 10% range. Stay open to the possibility that this may be an admittedly gut-wrenching re-test of BTC SMA(200) rather than a sign of a change in trend. Note that this re-test also shows up on the...

truecodecapital Updated 

Despite the pop today, BTC still hasn't broken through the resistance necessary to transition into a support zone. Be careful until the SMA(200) or SMA(20) hold. Keep an eye on the 4-hour chart for emerging trends.

truecodecapital

Lumber is finding support finally after losing nearly 70% of its value in eight weeks. A breakdown beneath the 200-week moving average could mean pain for the broader economy. The last times a long-term lumber trend stayed under the 200-week moving average was the 2006-2009 financial crisis period and the 2016 bear market for stocks.

truecodecapital Updated 

ETH just rejected by SMA(200) and SMA(20) range, which happens to coincide with the 4-hour SMA(200) as well. Don't get your hopes up until the SMA(200) on the 4-hour and daily charts holds.

truecodecapital Updated 

BTC is still channel-bound on the daily chart. The channel lines up nicely with the SMA(20) and EMA(21), which are also common points of resistance in a bear market. If it doesn't break through the channel soon, there is little hope of returning to a bull market in the near term.

truecodecapital Updated 

If a breakout is going to happen, it will happen here first. Then the breakout flows through to the longer timeframes. It seems like four hours is about the sweet spot for BTC. Long enough not to get faked out, but short enough to react quickly.

truecodecapital

It looks like a triple-bottom forming for ETH. If it breaks through the SMA(20), this could be the trade of the year. If it fails to break the SMA(20), stay in capital preservation mode.