10/1 Bull trap is confirmed. Monthly level $64k didn't hold.

2 paź

Overview:
The SPY started the day with a large red candle, erasing all of Jerome Powell's optimism from his speech yesterday. Early in the session, before the Federal Reserve even released its report, the market was already sliding, triggered by more-than-expected job openings. Within the first 60 minutes of trading, all of last week's gains vanished. Adding to the downturn, trading volume surged, surpassing yesterday’s levels, signaling increased selling pressure.

As is typical, the Nasdaq QQQ experienced more significant swings, hitting its lowest point of the day, which coincided with the highest point from last Wednesday’s rate cut announcement. This underscores the volatility in the tech sector.

All eyes are now on Friday's unemployment rate report, where the market expects a figure of 4.2%. Should the report show lower unemployment driven by improving labor conditions, it may compel the Federal Reserve to keep interest rates high. Such a move could further dampen the growth of risky assets like stocks and cryptocurrencies.

Tuesday marked the first day of negative ETF flows for Bitcoin. Major players like Fidelity, Bitwise, and ARK Invest dumped approximately $250 million worth of BTCUSDT . Meanwhile, BlackRock continued its seven-day buying spree, leaving many to wonder: Do they know something retail investors don't? Or perhaps they aren't as "smart money" as often assumed? Only time will tell if loading up at the 60k level was a wise move.

Despite initial hopes, Bitcoin has not yet proven itself as a safe haven asset like gold or Swiss francs. In times of heightened geopolitical tension, such as the recent events in the Middle East, risky assets like Bitcoin and altcoins tend to suffer the most.

BTC TA:
W: In just two trading days, Bitcoin’s weekly candle turned red, dropping the price below the $64 k level, which coincided with both monthly and weekly resistance. Up until Monday, there was still hope for a potential fifth bull wave if BTC could recover the $64 k level after the initial drop. However, continued selling pressure wiped out any bullish momentum.
D: Monday's bearish prediction proved correct, with Bitcoin dropping by 3.98% on Tuesday. This sell-off is significant but not unprecedented, as larger price movements occurred in early August with losses of 5.70% on August 2nd and 7% on August 5th. Are we seeing a repeat of early August? September's first week wasn't particularly bullish either, with prices briefly touching 56.9k. Unfortunately, the current MACD setup looks eerily similar to the lead-up to the August 5th crash. Currently, BTC is hovering around the 61.5k level, which was drawn weeks ago as a key support.
4h: The RSI is now oversold, but the MACD has not yet shown any bullish divergence. There is potential for a short-term recovery to the 63.5k - $64 k level, but sentiment remains cautious. Short-term bullish.
1h: On the 1-hour chart, the RSI has started to rise, moving toward the 50 level, indicating a neutral stance. No clear divergences have formed.

Altcoins Relative to BTC:
Earlier in the week, altcoins were outperforming Bitcoin, negating any concerns of a bull trap. However, they have since retraced to their respective moving averages without front-running this recent BTC crash. Altcoins are moving in sync with Bitcoin, showing no major divergence.

Bull Case:
BlackRock could be proven right, continuing to buy at the 60k level. Should Bitcoin dip to the $58-60k range, they may accumulate even more, reversing the bearish sentiment and forcing retail traders to halt their selling.

Bear Case:
The fifth bullish wave has officially failed, confirming a massive bull trap. If BlackRock's strategy fails, retail investors may see a significant wipeout.

Fear and Greed Index:
The Fear and Greed Index dropped to 39, officially entering "Fear" territory. Historically, entering the fear zone has led to steep declines:
07/04: The market dropped 6% the next day.
08/04: A 15% drop occurred the following day.
09/03: A 9.25% decline within three days.

Prediction:
The bull run appears to be invalidated. After three weeks of growth, BTC is now likely to correct down to at least the 61.4k - 59.1k range by the end of this week.