Bitcoin: Sidestepping the Sell Signal?

While Bitcoin is still within the range of a supportive inflection point (10,500 AREA), it is on the verge of generating a new SELL signal. Our swing trade strategy strictly prohibits shorts, so we have no intention of participating, but I will mention it since that is what the chart is presenting.

Things to look out for though: The broader trend has NOT changed. Which means bearish fake outs are very likely (double bottom, failed low). If taking a trade on the short side, it is a good idea to use more conservative targets in such an environment. Anyone that is hyping over exaggerated levels like 6K are seeking attention.

In order for our broader technical outlook to change from bullish to neutral, the low 9K area needs to be cleared. ANYTHING can happen so it is possible, but the probability of such an event at this point is still low.

The momentum from the recent bearish move can still follow through, but what we are anticipating is a broad consolidation with the range lows established somewhere in the mid to low 9Ks. Those are now the areas we are looking at for new potential swing trades long. This type of chart formation can take weeks to unfold.

It is important to keep in mind, NO ONE knows anything for sure in this game (unless you have inside information). And a chart CAN'T provide any type of precision timing. Charts can imply clues and we measure RISK from those clues. When new information presents itself (like the 11K support break) the BEST we can do is ADJUST our outlook and probabilities based on what that information implies. What produces performance over time is GOOD RISK MANAGEMENT. Simply put: you need to lose less than what you win, otherwise you cannot win over time, no matter how high your win rate is.