BTC - Long? Short? Lets use basic maths

2022年10月28日

Hello everyone,

The market has had a lot of choppy sessions in October, earnings being unusually weak but the possibility of a lighter Fed due to in-line PCE numbers, as well as hitting a 50% retracement, sparked a relief rally in risk on assets. It is apparent BTC took relief too as it broke the $20,000 psychological level.

Let's keep it simple. Using previous data on BTC cycles, basic mathematics dictates that a bottom at $10,000 is very likely, as we average the corrections and the date from top to bottom. It is increasingly unlikely BTC would form bullish momentum as we look at the long-term log scale due to fact BTC is forming lower lows and lower highs under the key long-term trendline.

A potential to extend gains is very likely as it heads into November, On Weekly TF, BTC sits just over 300MA, and may try to retest major resistance of $25,200. This would also be important to confirm market direction, as a rejection at this level would validate the long-term trendline as resistance and an initial bottom at $10,000 would be likely.

Macros are very important atm, and as November would indicate a downward area in market cycles, this would validate the $10,000 bottom theory.

Let me know what you think.

2022年11月12日

註釋

It seems, upon the choas of issues with exchanges, BTC has not headed higher to test the key long-term trend line, but instead made another lower low on higher time frames as mentioned in the post. This opens up a high possibility of a lower high in the coming weeks, possibly to $18,500 to reach the fib 0.5 - 50% retracement. What I find much more interesting than this anticipated price action, is how weak BTC has become in terms of correlation to the overall risk-on, stock market. SPX, SPY, NASDAQ, etc, had a KILLER day of gains followed by yet another killer day of gains after inflation CPI report had indicated cooling inflation for the first time in 7 months, with both headline and Core CPI coming in lower than expected, thus the market reaction of a peaked inflation. It also prices in 50bps hike in December, of which should be the final of the hikes from the Central Bank. However, crypto had a very limited reaction to the report, and instead reacted much more violently to the fall of crypto exchange FTX, which announced bankruptcy.
The Correlation Coefficient has reflected this change in sentiment, seeming to divert from a peak of 0.80 on the weekly time frame. Overall, I am sticking with a lower high theory, at which point I will keep up to date with the crypto market to determine whether a lower low is possible.

2022年11月15日

註釋

Possible moves for BTC as it heads for resistance:

2022年11月26日

註釋

A pretty uneventful week for markets this week, indicies stretched further (SPX 2.5%, NDQ 2%, U.S. Dollar has lost a lot of ground this month but seems to have found integral support at 105.6, metals seem to be forming an inverse head and shoulder (but volume and momentum are not promising) and BTC has been making lower lows and lower highs unable to break above parallel channel to challange the local $17500 and $18500 resistance levels.

2022年11月26日

註釋

2023年1月3日

註釋

While stock markets continue to fall, BTC is holding in a tight $16300 to $17500 range, trading the falling channel it formed as an extension to a Bullish Triangle. However, seems danger is not out of the question yet, as this falling channel is forcing BTC to make lower highs and lower lows (lower TF).

2023年1月3日

註釋

Also, TV has been getting weird with my tools since New Year's, what's up with that??

2023年1月13日

註釋

BTC has finished off what seems like re-accumulation to make a higher high on lower TF. I expect distribution to bring the price back into $16,600 support range

2023年1月14日

註釋

As markets have analysed equity market data, distribution from the $18,800 price point was invalidated and continued to touch $21,240 in the largest weekly move since early November.

Current levels show a strong resistance at the $21,000 area. This move (if counting wick) has just about broken the long-term (weekly) lower high trend, and is trading above the 200D MA for the first time since Dec 2021, which is bullish for BTC and alts.

I suspect we will move back towards the 200D MA to test the area as support.

2023年1月22日

註釋

Early update on this before equity market starts moving the crypto market later today, what is MORE than likely is we have exited the 15K-18.5K trading range for NOW as markets have judged this area to be oversold in consideration to wider factors such as macros and opportunity cost, and we will trade in previous 19K-25K range as this progresses.

This means we are currently trading at the Upper Boudry of the range. As well as this, the strong rise in price of BTC has put the RSI well into overbought, with a bearish divergence, automatically bringing short term bearish bias. Volume and momentum has slowed, and we seem to be rejecting the (very important) 23K resistance level.

All of these considered, we are very likely to revist the lower boundry of the trading range (<22K) in the short term.

However, as I said before, the current BTC movement is very much bullish. The 200 D SMA has been finally conquered, and is starting to turn up, improving chances for further momenum upwards.

I did close 50% of my short at 16K, I'm currently watching the wider market data and correlation to equity index, if we see promising results, I am to close the other 50% at approx. $19250.