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.
8-Hour Bitcoin Chart
What an incredible price action we had yesterday! The chart does not need a lot of explanation, it turned into a solid bullish scenario. Predator painted our candles to green, and we are above a nicely rising 20-period moving average. This is awesome news for the long traders, the short players may take a pause now. As I always mention however, the 8H chart is not enough for me in itself to enter into a position. I am a trend trader, and my main focus is on 1D and 3D charts. I am using the 8H chart to lay the bed for further decisions.
1-Day Bitcoin Chart
Part of my net wealth is hodled in a Bitcoin stash that I am not intending to touch for a long time. And as a hodler, these long green daily candles make me smile and smile. Incredible price action yesterday. The price catapulted from the Fibonacci resistance at 43800 like a rocket, a real breakout. The daily chart became a solid bullish chart. We are in a bullish trend here, above a nicely rising 20-period moving average. Good for the bulls!
As I mentioned yesterday, there was a heavy resistance zone at 44600–45000 and a lot of short players have set this area as their stop position. Now these short players have been washed away within 30 minutes in a solid short squeeze at around noon, and that short squeeze resulted in a USD 2500+ move northwards. Following such hectic moves, be prepared for some correction.
In addition to the usual chart, I also wish you to take a look at how the Ichimoku Cloud looks on the 1-day Bitcoin chart. In general the principle is, that above the Cloud it is bullish territory, and under the cloud the bears have the ball. Trading in the cloud is a no-go. As we can see, the Cloud very nicely caught the bottom, and is currently serving as a resistance before a possible further upside.
3-Day Bitcoin Chart
The only thing keeping me from jumping on the buy button right away is the 3-day chart. We are back above the 20-period moving average, which keeps on rising. The Predator indicator does not however confirm a bullish trend yet. This timeframe is very strongly leaning bullish, but I would not exclude a retest of the 20-period moving average around 46600 or the Fibonacci support at around 43800. Such a retest would be absolutely healthy and it would turn those levels into support for next moves.
Weekly Bitcoin Chart
This timeframe is not a usual guest in the daily newsletter, but I wish to show you something interesting here. It shows how strong the Fibonacci levels are for pinpointing support/resistance lines. They are drawing the price action as magnets around the important levels, creating estimated zones for support and resistance. This weekly chart is great example of that.
Summary
The most recent price action shows how important it is to put the trends into the longer perspective, and understand the importance of the 3-day chart in Bitcoin trading. Just three days ago in this newsletter I said that the 8H and 1D charts were clearly bearish, and only the 3D is holding me back from entering a short trade. The fact that the 3-day chart saved me from a lost short trade is highly important to me, this is why I am always waiting for all three of my charts to point in the same direction.
As for now, we are bullish on the 8-hour chart, bullish on the 1-day chart and we are leaning bullish on the 3-day chart. I am very close to opening long positions, but I prefer to wait for a retest of previous resistance zones at around 46600 and 43800, or enter long if the Predator indicator on the 3-day chart closes green — indicating a bullish trend.
Global Bitcoin News
The president of El Salvador, Nayib Bukele has shared on Twitter the fact that the country is in the process of mining its first Bitcoin with thermal energy harnessed from its volcanoes. Following making Bitcoin a legal tender in the country, El Salvador is now contributing to the mining of green, eco-firendly Bitcoins. Well done Mr. President!
Iran has lifted its ban on bitcoin mining instituted in May, and licensed farms can come back online, reports the Bitcoin Magazine. The summer months usually increase energy demand in Iran when high temperatures prompt citizens to overuse air conditioning. But now that September is gone, and with it, the summer, miners can spin up their rigs and restart operations. It is estimated that the country houses around 4.6% of miners globally. In the meantime, Ali Sahraei, chief executive of the Tehran Stock Exchange, has submitted his resignation after cryptocurrency mining machines were uncovered in the building occupied by the organization.
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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.
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.
