Crypto Short

General When it comes to a bubble, the concept of support is not traditional as we understand. To me the support develops in stages. Before you understand the support, recall the following definitions: Support Level: It is a single price level at which level demand is expected. Support zone:  It is a price range that ultimately becomes a demand zone. Stage-I (Near Parabolic Rise): A highly volatile environment, where the price may briefly hit the demand zone. Stage-II (Confirmed Decline): It is a second phase when the price makes lower highs with reducing volatility. Price may still fluctuate at weekly ATR on daily basis.  Stage-III (Reduced Decline Acceleration): Extremely reduced volatility that is often historical. Less trading interest, and very low volumes. This stage usually takes time such as months or years. Despite knowing these things, you may not assume that a Price-X is a support. Usually at Stage-III price may still decline a bit b...

Today, I am going to explain one of the simplest thing in trading that we often forget. The question is why 6K for Bitcoin , why not 7K or 4K or 2K or 1K? You may have your answer but do you have any explanation to that. Perhaps, yes or maybe not. Hang-on, we need something that you can tell from the data without drawing so many lines. Here comes a dirty chart, with messy lines and one simple explanation. Below this chart, I explain two mindsets, first the dirty trader mindset, and second, the simpler investor's thinking. A Trader's Explanation An average crypto trader trades a few bitcoins. He has to draw all small scale features on a chart to trade a trend. For instance on this chart you see a simple Fibonacci fan in a bear market. Each high developed a peak on a fan and followed the fan such that there are lower lows, a bear market. Then the next lower high, which is followed by subsequent lower lows until July 2018. But see what happens next, still a bear market ...

6000 - The Provisional Bottom Bitcoin touched the bottom three times, and on the fourth time, things were different: 1) Price volume were not in sync . 2) Correlation between  2014 and 2018 told where should be the bottom. If 6K bottom is real, all we need is to see: Confirmations Daily to close above 6K on the next fall, which happened on Aug 10, 2018, when the PVT was diverging from the price. (a) Confirmation of a close above 6K (b) Confirmation of Price volume divergence - rally ahead. (see the figure a). Bitcoin to maintain the higher low setup and should stay above the weekly close i.e. 6200. See the image below, which outlines a correlation between 2014-15 and 2018 in search of bottom. Notice that the 2014-15 crash defines a near double bottom event (Weekly Close Line), which was confirmed upon next corrections. It is expected that a re-test of 6200-6600 to occur in coming weeks, and if that level is held, BTC will enter in a bull ...

Many traders will find abundant similarities between two crashes and may say that the history will repeat itself. However, we as a trader mostly overlook things. Here is another important aspect that we have overlooked. Bitcoin first drop during high volatility days defined the support as indicated in red ellipse. This held true in 2014 and was never broken. This also holds true to-date as 6K support was briefly touched but was never broken for weeks. Bitcoin rebounded at least three times from this support and this will be the fourth time if it does again. If this analysis or view is true, then 6K is our final bottom.

This is the fourth time bitcoin is touching the 6K and has developed a near 5800 bottom. The price had a free-fall from 8500. However, when it came down to the 6K support, it behaved like it is close to a gravitational pull. Instead, it slows down. Take a look at the price and volume actions. Especially, the OBV and PVT. Both hold a key when it comes to the reversal pattern recoginition. When every one is bearish, you need to look at some out-of-box tools or utilities that can help you in defining a position. When we touch the support 4th time, it simply means that the support is weak. However, this doesn't mean that a rally cannot begin. Every one expects the bitcoin to reach 2K so that it comes a good buy. Ask yourself, will you buy it? Most probably not. Here is a capture of some key divergences: Regular Bullish Divergence against RSI OBV - Hidden Bullish Divergence Regular Bullish Divergence against PVT With these divergences in-hand one should think about accumul...

If you don't know how to get in and out of a trade when you trade on daily, then try this approach. That is very effective in stock market as well as in crypto according to my experience. Here is a running example of bitcoin, where it is long since 6000 since the RSI9 is above the RSI14. The exit plan is when RSI9 falls on or below the RSI14. If RSI9 stretches down further i.e. below 46, it is a short opportunity. Update: July 24, 2018 Here we are again, back with this trade. See yourself how good the reversal was based on this.

Bitcoin is on its way to confirm the reversal pattern. Here are the series of events that happened post the longest bearish trend (50-days long). June 23 was marked as swing zone based on Fibonacci Time Extension. The next day prints a Dragonfly Doji pattern,   which is traditionally a bullish sign. Attempted a panic sell situation but the price couldn't free-fall. Instead, BTC gradually dropped below 6K. Further drop could only put the CMF or volume higher resulting in a strong bullish divergence. This was also notable on the momentum indicators such as RSI. Note that we have not see so many bullish divergences of RSI in case of BTC. We have seen two major bearish divergences near psychological levels (20k, 10k). While the Awesome Oscillator shows twin peaks with some buyers strength. Here is another daily chart with other indicators. Note the swing zone 21 and the follow-up Doji. Conclusion: It is clear that the reversal pattern might b...

Here is a general look of BTC after healthy corrections in early 2018. Several important points: BTC is currently trading near Fib0.618 and was previously bottomed (Provisinally) near 6000 (Fib0.786). In Q4 2017, BTC and ADL (Accumulation Distribution Line) were following the same up-trend. Since the price divergence (end Dec / Early Jan), ADL kept on accumulating during the entire decline period. At present, 50-days MA (Moving Average) curve has been flattened close to 100-days MA suggesting a change in trend is approaching. This is the reason why I am more bullish overall and will keep holding my positions by accumulating in this range (7200 - 9200). My further perspectives & daily updates are posted on: 1) Investing.com 2) TradingView.com

Here is my review in search of finding the BTC bottom. Hopefully, you will find the hidden answers after reading my post. Verdict Whenever there is a crash, there are two supported levels that I use: Fibonacci Level 0.786 / 78.6% relative to maximum low i.e. either $0 or $1 or around that. This level is theoretical in cryptocurrency i.e. 0.889 / 89%. ------------------------------------------------- Bitcoin A very important question in the current descending market trend of Bitcoin, which is trading around 6900 at the time of writing this article. To understand this, one has to know two fundamental levels in BTC crash: 1. What is the maximum level that BTC can be re-traced? 2. What is the maximum decline level that BTC has seen so far relative to the first question? To answer these, one has to stay away from relative price levels. For instance, if I consider September (2017) price as a bottom assuming it will never be breached in future, I will always be wrong si...

A better updated chart with SMA curves since the chart below can be confusing as it uses MAC Channel. DASH's DEATH CROSS has already happened and is eyeing the potential demand zone around $200 for investments......nnnhttps://invst.ly/70yox...For the time being it looks like an asset which isn't easy to trade. If it doesn't hold above this support (dashed red line), it is very likely to test the underlying one where potential demand may bring it back to golden cross .   I don't anticipate this to recover soon but given crypto-world, it may show some signs recovery later this year since much is dependent on BTC and the money circulates through trading. https://invst.ly/70yox