BTCUSD update: 9895 new high and poised for 10K. The music hasn't stopped yet, so if you are in, the best you can do is manage and be aware of any early selling signs. If you are out, now is not the time to get in.
I do not want to sound repetitive, but this price action is very suspect. Runaway markets like this are rare, and unusual and will encourage bad habits among the inexperienced. What you are seeing in all of these markets is very bubble like and best for taking profits in my opinion. I have seen this before and it is just a matter of a surprise. Some "unexpected" news.
If you want to hold because that is what has been working, then by all means hold, but you would be foolish not to lock in at least 25% at these levels. A few years ago, silver went from around 15 to 50 in a very short period of time. There was all this talk about a huge silver shortage and how one major bank was stuck in a large short position. The metals are relatively small markets, are limited resources like the coins, and they have to be mined. I figured silver would be at 100 at the rate it was moving. Know where it is today? 17.
There may be different drivers and catalysts for the coins, but markets that go too far too fast play out the same. (Google Tulip Bulb Mania).
I measured an extension from the 5114 low and projected from the 5400 low, and it revealed a 1.618 at 9959. This is a target and psychological resistance. I am not going to generate new support levels until this market decides to show signs of weakness.
One level that I will be keeping an eye on is the 9450 level. Why 9450? It is the low of an inside bar on this 12 hour chart. A break below that, and that will be the first sign that momentum MAY be changing in this market. From there I will evaluate the relevant support levels. That is my only plan for this market at this point.
One thing to consider if you do not know whether to hold or sell is use a manual trailing stop. Since this market is not really retracing, use the previous day's low as a reference point. Each day, as the market fails to retrace, you raise the stop to the higher low. Eventually, you will get stopped out, but the market will decide instead of you. This often allows for staying in a move longer because you take yourself out of the equation. The thing is IF the market gets noisy, it is possible to get stopped out and then watch the market go higher without you, but if you are walking away with a profit, there should be no complaints. This works well in trending markets that do not retrace (like what we are seeing now).
In summary, ride it out until the music stops but do not be afraid to take profit. There seems to be this "entitlement bias" that is running rampant among newer investors. They believe they are entitled to sell the top and if they sell and take a profit, and the market runs up another 1k points, they get upset. That is greed and it is the same motivator that will seduce you into buying too early when this market decides to really sell. As far as swing trades go, I have no interest in taking any risk at all at these levels. I don't buy highs of asset bubbles. My plan at the moment is to wait for the next major support which is in the low 8ks and EVALUATE from there.
These are difficult times for the traditional experts. Bitcoin is different from anything humainity has met so far.
It has nothing to do with your silver and tulip comparisons.
Today's high will be tomorrow's low.
A year from now 10 000 will be a discount price.
Can is crash or go into a correction? Yes, it can. But waiting for a huge correction and watching the price go up-up is probably not a good method.
IsraelLot
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I like reading your BTC analysis, helps me be rational on these crazy times.
JasperVerleyen
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what is your view on ETHUSD?
Cleanbucks
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Gives a clearer perspective...
alphapapa
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Hey Marc - fascinating and thorough analysis as ever. Two quick question:
1. which broker / exchange do you use that allows trailing stops
2. Do you store your coins on a hardware ledge?
cupfish
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@alphapapa, Marc's trailing stop suggestion was to manually set your stop loss each day, using the high of the previous day(s) closing price as your trigger. If today trades higher, then use today's price for the stop for tomorrow. Maybe the close price - 100$.
Ledger or Trezor is a good idea to store long-term coins, but you'll need the coins on an exchange to trade.
cryptoezvip
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Marc, if I am not mistaken, the 5th wave in your chart is also the (3) wave of another giant wave as shown in my chart, so we are riding the (5) wave now.
Folder5
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@bibboyne, 3rd wave shorter then 1st?
cryptoezvip
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@rolandcura, nice catch. The (5) wave has a 1st wave extension so naturally the v wave will be the shortest of all. My emphasis was that we are on the last wave of a giant cycle that should carry us to 11k. Here is an updated chart with better proportions of the waves. Thanks for pointing out.
Romalian
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I think that BTC / USD cannot follow any chart usual analysis. It's completely out of market as it's replacing Fiat currencies and will crush actual banking system. Exponential raise will be in the next days and months as a lot of people, that cannot have access to real valor of currency (Venezuela, Zimbabwe, North Korea, etc...) turn to Bitcoin.
It has nothing to do with your silver and tulip comparisons.
Today's high will be tomorrow's low.
A year from now 10 000 will be a discount price.
Can is crash or go into a correction? Yes, it can. But waiting for a huge correction and watching the price go up-up is probably not a good method.