Chartpunk Bitcoin Alpha #58
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
Situation on our high time frame Bitcoin chart is basically the same as yesterday. The price is still close to the bottom end of the ascending channel, the uptrend since July 20 is intact. The AVWAP level of July 20 is currently at 50300, and the trendline support is at 54100. I consider these levels as the ultimate supports of the current uptrend.
The AVWAP level of the September 29 upwards push is currently resistance at 58800, along with the AVWAP level of the November 10 pullback currently at 60600. These are immediate resistances on the HTF chart, that Bitcoin needs to confidently tackle in order to restore the totally bullish momentum on the market.
Stochastic RSI has become oversold on the 3-day chart, and has remained oversold on the 1-day chart. Historically the oversold 3-day Stochastic RSI has provided great entry points for long term dollar cost averaging Bitcoin investors and hodlers. If you are watching Bitcoin from the sideline, considering an entry, this might be the right moment to do so.
LTF Market Structure
Nothing has changed on the low time frame Bitcoin chart since yesterday. Bears are still in control of the immediate price action.
A downwards trend can be seen on the LTF chart, that has started on November 10, and has been reinforced on November 15. Key support levels for the bears are the AVWAP levels of 58600 and 60000, and the downwards trendline at 61000. As long as there is no confident price action above the 61000 level, the bears will keep on controlling the immediate price action of Bitcoin.
Based on the HTF and LTF market stucture overviews I did not change the zone chart since yesterday. Resistance zone is at the 59000–61000 area, and the bull market has currently its support at the 50000–53000 range.
Let’s zoom out for a sec!
As the weekly logarithmic channel of the long term Bitcoin price action is showing, the price is currently attempting to break above the middle line of the channel, but has bounced back from this resistance level. In my opinion we can expect the next real leg upwards when Bitcoin will successfully break and retest the middle line, currently being at the 64000 level.
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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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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.