Join me on the journey to a 250k+ Bitcoin price! We will definitely have some good and bad times on this bumpy road, but with good alpha we will be able to ride strong trends and avoid sharp losses. Being a trend trader, I am not promising to pinpoint exact highs and lows, but I hope my view will assist you in making your own decisions.
Market Structure
Nothing has changed significantly since yesterday in the Bitcoin market structure. I have erased our short term uptrend which started on 29 September, as it has clearly broken. On the 4H chart Bitcoin printed a lower high, which is a sign of breaking an uptrend. The market structure is still showing the consolidation in the channel of 60k to 63k. The stochastic RSI is oversold and has crossed upwards, usually this is signaling upwards momentum.
3-Day Bitcoin Predator Chart
Our long timeframe Predator chart has remained bullish. The Predator is green, and the 20-period moving average is ascending. Price is way above the 20MA, and the moving average is starting to reach the level of the 0.786 Fibonacci at 53k. Together they will serve as a very strong support for the case of a stronger decline in Bitcoin’s price.
1-Day Bitcoin Predator Chart
The 1-day chart has been printing red Predator candles, which is a bearish sign. The price is however still above the ascending 20-period moving average, and the stochastic RSI is oversold. This chart is calling for caution of the bulls, and in itself could serve as a reason to take some profits off the table. Sidelined investors however may see a nice entry opportunity in the fact of the oversold stochRSI and the ascending 20MA trendline. This chart situation is a very strong example for having to check multiple timeframes to be able to decide on our moves.
8-Hour Bitcoin Predator Chart
Our short timeframe chart is neutral, clearly not bullish. The Predator indicator has been printing red candles now for several days, which is a sign of bearish short-term price trend. The 20-period moving average is flat, and the price is hovering around its level. This chart has the potential of becoming bearish soon.
Summary
Same as yesterday, we are still in a market situation where a strong commitment and longterm strategy is required to make a good judgement. The macro environment and the fundamentals are great, hodlers have nothing to worry about in this respect. Seasoned hodlers are using these market situations to extend their exposure through some dollar cost averaging. The market structure is showing sideways action and consolidation between 60k and 63k, with longterm uptrends staying intact. Our 3-day Predator chart is also reinforcing the longterm bullish approach. The strong shortterm upwards momentum which started on 29 September seems to be gone for now. We saw our uptrend breaking on the market structure chart, and both of our 1-day and 8-hour Predator charts are showing bearish signs. I am still long, and I think the upwards price continuation has higher odds. But I am closely following the market, and I am ready to partly de-risk the portfolio in case the bearish price action gets stronger.
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What is trend trading?
Trend trading is a market strategy that is reasonably different from swing trading or day-trading. A market “trend” is a tendency of a financial market price to move in a particular direction over time. Swing traders and day-traders are usually trying to pinpoint low-term market tops and bottoms, and take aggressive positions expecting to profit from a swift change of market direction. Trend traders are looking for consolidated and strong directions on a given market, and are trying to ride the trend for as long as possible. These traders normally enter in the market after the trend “properly” establishes itself. My core strategy in trend trading is to look for a market setup where the 3-day chart is indicating a solid trend, and is supported properly by the 1-day and the 8-hour charts.
What is the indicator coloring my chart candles?
I am using the Predator indicator from Decentrader as my core trading tool, that is coloring my candles green-red-turquoise-orange, and is providing me basic information on the trend. I am also using the 20-period moving average and Fibonacci levels for the identification of supports and resistances.
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Join the discussion!
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Disclaimer
The present article is a free material, for entertainment and educational purposes. Nothing in this post shall be considered as financial advice, you shall never make any financial decisions or financial investments based on a singly source of information and without doing your own research.
