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.
HTF Market Structure
Bitcoin is in the lower half of the ascending channel of July 20. The channel is quite strong, with multiple touches both on its upper and lower trendlines. As long as the channel is holding, the Bitcoin high timeframe market structure will remain bullish. The stochastic RSI is still indicating oversold momentum. Support on the high time frame chart are the 53500 trendline and the 50200 AVWAP level. Resistances are the 58900 AVWAP level of the September 29 bounce and the 61250 AVWAP level of the November 10 pullback. Since the stochastic RSI has reached oversold territory on the 3-day chart, and the price is very close to trendline support, I think this is a good point of long entry for dollar cost averaging investors.
LTF Market Structure
The low time frame Bitcoin market structure is bearish. The bearish trend of November 10 is currently supported by the trendline level of 62200 and the AVWAP level of 60800. The shorter AVWAP currently at 59300 has been also reinforced as bear support yesterday by the price bouncing back sharply from its level. As I said in previous newsletters, these LTF AVWAP levels have been serving as nice swing short entries in the previous days.
Summary
As long as Bitcoin is not able to confidently move above the 62000 price level, the short term bearish conditions will govern the market. In the long term the bull market is intact with the ultimate support level of 50000–53000. The fact of HTF oversold momentum and the price action being so close to the ultimate support this could be a great long entry point for long term dollar cost averaging investors.
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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 long time frame market structure is indicating a solid trend, and intact price action is supported properly by the low time frame charts.
What are my key indicators?
I am using trendlines, channels and moving averages to identify market structure and to spot trends. In crypto trading my core moving average indicators are the 50 and 128 daily moving averages. I am also using anchored volume weighted average price (AVWAP) analysis to identify support/resistance levels.
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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.
