Bitcoin: Still Not A Long?
Higher low now established off of the 20K area. Usually higher lows often lead to higher highs and many fake gurus will be screaming for your attention to let you know the bottom is now in. While it may be emotionally appealing (like pizza), there are a number of factors that must be considered before arriving at such a conclusion. Here's the objective point of view:
The recent bullish structure off of the 18,500 low contains 3 legs. Typically 3 legged structures are corrective, and in this case, price is correcting a predominantly bearish trend. While higher lows may be the beginning of a trend change, Bitcoin has yet to prove that a new trend has begun. It does NOT matter what temporary catalysts led to this reaction.
The broader price structure (going back a year) is STILL BEARISH. Not one major RESISTANCE level has been compromised. The first one is the area between 22 to 25K. IF price fails here over the next week or so, a test of low (18K) is within reason. Structure continues to favor a bearish outcome. Don't be misled by irrational price movements.
The U.S. Dollar is NOT in a bearish trend, YET. A retrace inside of a consolidation within a broader bullish trend is NOT a trend reversal. The bond market continues to support a strong Dollar. Have you seen the recent FED action? Rising rates are still part of their agenda. This translates into an environment that does NOT Support speculative assets like Bitcoin. Rallies are likely to be TEMPORARY until cheap money flows back in.
These are the broader factors that I consider and they are based on the facts presented by technical and economic variables. While anything is possible and a positive change can come along and prove itself, the probabilities cannot be ignored. Eventually the cycle will change, but NO ONE KNOWS when, even if they claim to know. For this reason it is more effective to FOCUS ON RISK, not fear of missing out.
I recently shared another Bitcoin short idea from 20,250. It has not stopped out yet, but an early exit for a smaller loss is likely. Profit comes from effective control of losses, NOT "maximizing" your win. Do yourself a favor and learn to separate yourself from conventional wisdom and retail behavior.
Thank you for considering my analysis and perspective. I hope you find it helpful.
The recent bullish structure off of the 18,500 low contains 3 legs. Typically 3 legged structures are corrective, and in this case, price is correcting a predominantly bearish trend. While higher lows may be the beginning of a trend change, Bitcoin has yet to prove that a new trend has begun. It does NOT matter what temporary catalysts led to this reaction.
The broader price structure (going back a year) is STILL BEARISH. Not one major RESISTANCE level has been compromised. The first one is the area between 22 to 25K. IF price fails here over the next week or so, a test of low (18K) is within reason. Structure continues to favor a bearish outcome. Don't be misled by irrational price movements.
The U.S. Dollar is NOT in a bearish trend, YET. A retrace inside of a consolidation within a broader bullish trend is NOT a trend reversal. The bond market continues to support a strong Dollar. Have you seen the recent FED action? Rising rates are still part of their agenda. This translates into an environment that does NOT Support speculative assets like Bitcoin. Rallies are likely to be TEMPORARY until cheap money flows back in.
These are the broader factors that I consider and they are based on the facts presented by technical and economic variables. While anything is possible and a positive change can come along and prove itself, the probabilities cannot be ignored. Eventually the cycle will change, but NO ONE KNOWS when, even if they claim to know. For this reason it is more effective to FOCUS ON RISK, not fear of missing out.
I recently shared another Bitcoin short idea from 20,250. It has not stopped out yet, but an early exit for a smaller loss is likely. Profit comes from effective control of losses, NOT "maximizing" your win. Do yourself a favor and learn to separate yourself from conventional wisdom and retail behavior.
Thank you for considering my analysis and perspective. I hope you find it helpful.
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