Bitcoin Chartpunk Daily Alpha #31

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

Bitcoin Market Structure

Bitcoin is still in consolidation in the zone between 60k and 63k. The longterm uptrend is intact, the shortterm uptrend of 29 September has been broken. The stochastic RSI is oversold, which usually is a sign of a coming upwards momentum. 53k is a key support to the south.

3-Day Bitcoin Predator Chart

Bitcoin 3-day 2021.10.27.

The 3-day Bitcoin chart with the Predator indicator is my favorite and this is the one usually driving me into sizable positions, but I always wait for confirmation from the 1-day and 8-hour timeframes. This chart is bullish. Price is above the ascending 20-period moving average and the Predator indicator is green indicating bullish price action.

1-Day Bitcoin Predator Chart

Bitcoin 1-day 2021.10.27.

The 1-day chart is not bullish, but not yet bearish to me. The Predator indicator has been giving us red closes for 3 days now which is bearish. The 20-period moving average is ascending, and the price is hovering just above the MA level. If the price would start to print strong closes under the 60k level and the 20MA would start declining, the chart would then become bearish. Currently this is a no-trade chart.

8-Hour Bitcoin Predator Chart

Bitcoin 8-hour 2021.10.27.

I am a trend trader, and my main focus is on 1D and 3D charts, along with the general 1D market structure. I am using the 8H chart to lay the bed for further decisions. This chart is bearish. The price has lost the 20-period moving average twice in the previous days, and the 20MA line has started to decline, indicating a bearish price trend. The Predator indicator is printing consistently red candles which is clearly bearish. There is no way around this, this chart is bearish.

Summary

As the price consolidation in the 60k-63k zone extends, we can see the shorter timeframes slowly running out of bullish momentum. The market structure is still looking bullish, the losing of the previous swing high and Fibonacci level of 53k would make me see it otherwise. On the other hand, our shorter timeframes are showing a growing bearish momentum, the 8-hour is clearly bearish, and if the 1-day loses the 20MA level, it will also become bearish. Bitcoin is arriving to the crossroad, where the future direction will be decided. My bet is upwards, but the long position shall be closely followed. The longer the consolidation, the more aggressive the subsequent price action will likely be.

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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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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.

Trading and hodling bitcoin since 2015 I Focusing on longterm trends I No alpha for daytrades