Not much has happened over the weekend so our previous article was and is still valid. I wanted to wait until the futures market reopened to post my next article. As of 1:30am NYT the Dow Futures are slighly up at 0.76%, gold has recovered 0.55%. From the chart below there was an original selloff at the open of trading but this was quickly bought up once again. As the Dow Futures market opened we saw a small dip followed by a spike and pullback, but has since started to trend up. Though this is the futures market I believe the DOW opens higher this morning. Why am I talking about the DOW here?
As I spoke last week there was a clear correlation with the spike in volatility and the correction in not only Bitcoin' but with several other markets as well. Even the gold market which is a traditional safe haven trade saw a short term selloff as high risk volatility traders were forced to sell assets in order to cover margin requirements. This left no market unscathed and actually started a snow ball effect which magnified the issue. As traders sold equities in the bond market, yields started to rise which kicked in algorithmic trading bots that further sold off equities to move into bonds at a discount causing market longs to have to cover and the selloff started to snowball. This is why I can NOT emphasize enough that trading on margin is extremely risky. Not that there isn't a place for margin accounts, there is, but in high risk equities you are walking on thin ice. This is not selling cash covered put options on JNJ' where you are willing to buy the stock if it dips below your contract price. This is highly leveraged risk assets that a small move can create a cascading effect like the one we saw last week. As a buy and hold longer term investor, I just simply rode out the storm and I will be looking to add stocks like P&G this week at a discount.
Bitcoin' has recovered and though we expected it to pullback to the 7225 and 7885 zone, which are the 0.382 and 0.618 retracement levels of the recent bull move, the pullback was very shallow. A close above 8565 and continuation I will look to start adding longer term positional trades not only in Bitcoin' but Ethereum' and others as we set up for the next bull run. I will add there and a breakout of the 9838 level with an initial target zone of 13,000 to 14,500. Whether we hold there for the 17,000 level we will determine then.
Long term we have a target level of 20,000-24,000 which would complete the fifth wave of the overall broader bull run. Keep in mind these are preliminary levels and we will adjust as we move forward. On the bear side a breakdown of the 7225 level would bring into play initially the 5250 zone but also increases the possibility of an extreme low in the 4300 area. My personal opinion is this is highly unlikely, but is always possible.
In closing the past two weeks has shown us that retail and some larger investors are surely invested in the crypto market. The correlation among markets was as evident as it comes, as I posted in previous articles. This was a temporary selloff due to the high risk derivatives market and though we may trade slowly to the upside slightly horizontally, a break of 9838 will surely bring buyers back into the market. History has shown that market herds are generally wrong and this couldn't be more evident in the impulsive nature to sell at extreme lows as we saw recently or buy into extreme highs as we saw in late December. Though we will never make every call perfect, we understand how these markets move and do not push the panic button.
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评论
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Many consider BTC digital gold. I am sure of that thinking. Many comparisons to gold have been made and many are calling for another dip based on this comparison. I'm not so sure. We have seen a three legged correction in both gold and BTC. Gold is a tug boat and BTC is a speedboat for comparison, but the herd mentality is the same across all asset classes, this is no exception. After the third dip in gold, most "analysts" were bearish calling for 500-750 levels which never happened and we actually saw a fake breakout. We see the same sentiment here with calls of 3000-5000 in BTC. Now these levels are possible, but I'm seldom trade the same way as the herd except in strong bullish as we moves. I still expect one more pullback so I am hesitant to add here as we did not see a continuation of the close yesterday. At this point I want to add only during a confirmed breakout, or if we dip and get a reversal. We may be setting up to trade sideways for a month or so where we may see the alt market recover before bitcoin.
Bottom line we must be patient and for longer term trades not look at the hourly and less time frame charts. At this point I'm looking at the 8 hour and daily as price action is slowly to the upside which is a good sign.
even though I've been trading for quite some time I've never been the guy who actively posts trading ideas (disregard my only public trading idea > my daughter tried her best!).
Anyhow, many comments in recent days I've seen are getting more and more negative or at least people complain about everything - just following so called gurus / good traders but not adding their own ideas to it. For those I feel sorry because they never learn how to trade. The herds always follow! But hey, that's not my point here :D
I wanted to comment on the overall outlook of btc (trading crypto since 2016 - been through a lot already). Maybe you noticed that I am using mainly indicators not very common to most people, because most followers are stuck in a time capsule - they see the day, the week and maybe a month but never the big picture. Long story short - here is why I see the btc bullish on long. ***
(mixing up fundaments & technical backgrounds > sorry for that!)
1) BTC adapts on a nearly daily basis their lightning network > 1800 Nodes+ // SegWit integration is on it's way (Check box: BitPanda; Coinbase and a few more)
The biggest reason people complained about is the slow transaction speed + fees. Well, this will be a thing of the past once most bigger exchanges added these features, no matter if its SegWit or lightning network. The result will be surely faster and cheaper transactions.
2) Regulations and institutional buyers
We hear more and more that governments are regulating exchanges. Great! Less scams, less fraudulent ICOs, less corruption, less money laundry. Also, we see a heavy increase in crypto trading desk being set up in major financial corporations, interest spikes in many countries, city council and so forth to support btc (or blockchain, lol). Nobody has the luxury to miss this train - nobody! (btw. Looking forward to the 20th when the 'Petros' will be introduced!! Venezuela might after all have a great future ahead (10yrs+?).
3) PE vs NVT
Whereas the PE ratio is a major indicator to valuate a product on the traditional market the NVT is THE indicator to measure the value of a network and it's overall transactions throughput in USD. (similar to Facebook: No user - no value; many users - big value!). We see a clear trend reversal (charts.woobull.com/bitcoin-nvt-signal/) with the chance to dip a little bit more. The overall NVT ratio is still in its norm even with the huge increase in price in December! There is plenty of room to move north as seen many times before (please look at the huge divergence between price and USD network throughput; we had 2 major bubbles already and survived and I am not talking about Dec. 2017!)
Firstly, we are still on the 3rd wave and a small dip over a week or two won't hurt anyone -patience is King, as always. Since the 3rd wave looks for a higher high compared to the first wave (2013 - 2014) we are looking at 30K to 100K depending when the bulls start to run! The later we run the higher the price will go, that simple.
Anyhow, no matter if it's 4K, 5K, or 6K at the end of day we should just stay calm! BUT BUT BUT this will most likely not happen since we just saw a closed weekly candle alongside the bottom of the lower mid channel (log chart!). (pm/dm me if you don't know what I am talking about). Most big hands bought in the dip already (order books exploded with 100+ btc trades!) and those who missed it should buy around 7.2 -7.5K in my opinion, but hey! Do your own due diligence :D. Should the trend break the log weekly lower-mid channel we will see a bearish market for quite some time but honestly, this doesn't fit into nowadays euphoric and revolutionising crypto market. There is only room to grow not to shrink. We see billions of fresh money from ICO's in upcoming month, banks cashing in, private investors buying in and maybe even bigger institutional buyers but that all depends on ETF's - it's just a matter of time until the bulls are done with grassing. Off to new territories, right over the mountains to a new refreshing meadow!
The RSI on the weekly just moved east and tries to stay above 50. A sideway move for a week would be indeed very healthy. Reenergise a bit and off you go btc! Good boy.
Daily RSI ain't bullish but it doesn't have to be. There is no need to create more FUD due to growth many economists don't understand. Why? Because most economists studied in the last century where markets have been pretty much "isolated". Now we see the Bitcoin as a world-phenomena and no one can really grasp how everything will work out in the future and that is good thing! I hate it when you can guess the end half-way through the movie; boring, isn't it?
Should you buy? hell ya! When that's up to you!
*** and always remember:
We are all living in capitalism which seeks for non-stop growth no matter the pain it has to go through. (That's not my opinion but a fact) Money is printed with no value on a daily basis (thanks to neoliberalism in the 70's). Crypto's are small compared to the Dow Jones and others trading trillions, gaining trillions and "losing" trillions - who cares! As long as we are humans filled with fear, greed, arrogance and stubbornness we will always doubt ourselves and feel jealous about others no matter if we might lose our fortune and future!
KISStheProfit
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Guys, just open any of ETH, BTC, LTC, BCH 1 minute chart with USDT, EUR of USD on whatever major exchange you like - you will be amazed. :) Just the moment price is different, the graphs are equal to the second - every pump and dump, every move in price. All exchanges are interconnected, that is how you see 20 billion market volume for 24 hours. It is a BIG lie! It is a BIG scam!
siwe7
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@KISStheProfit, are you serious? let me ask you, why they should NOT be connected?
TradingPretzel
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@KISStheProfit, haha, thought you were serious at first:)
RealMcafee
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@KISStheProfit, Bittrex uses bots in low volume periods to prevent arbitrage opportunities I guess. What you're saying is not exactly true, exact and to the second is false. There is always variation. Why TA works is because group behaviour tends to a statistical mean the larger the group. The thousands of people using each of these exchanges display similar behaviour under the same stimuli that's why price movements are similar. Nothing nefarious necessarily. That doesn't mean things don't happen behind the scenes, thing of Mt.Gox and BTC-E in particular.
GeXTV
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@KISStheProfit, goofball doesn't realize alts trade relative to BTC primarily. if ETH = 0.1 BTC, and BTC goes up 10% in USD terms, then ETH does too (roughly)
Snow_crash
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@mfgex, Just take a look on monthly history of ETH=0.1 BTC. ;)
mvogel13
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@KISStheProfit, :) agree...they all are colluded. The bildenburg via axa capital and mastercard via digital currency group control blockstream. They now control bitcoin also..sad but tue for all the idealist please kbiw the facts you can still invest but follow the money and know who is calling the shots.
milanjelic
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@GoldBug How can you be so serious about bullish Bitcoin, so bullish like many ones before you?
Bitcoin 10.98% is still rebouncing in a channel (7800-8400), it could stay there for a couple a few days, but when breaks trendline market will be pulled downwards with 40-45% price drop which might cause panic sell and lower the price (5800 level even deeper).
Everything with Bitcoin 10.98% would maybe look fine (if we deny fact that sinked already from 19.000 level to 12.000 level, some rebouncing, dropped to 10.000 level and continued to go with downward pattern all the way down to the price 6.000 level making him lose 70% of it's ATH 1.54% value.
Then rebounce to 8,500 level.
So, what now?
People are talking that this correction is finished, but it seems they are actually confused in general, because EVERYONE WAS BULLISH TILL WEEK or TWO and now suddenly EVERYONE IS BEARISH .
How come?
What that means?
That means that people who are trying to predict either Bitcoin 10.98% movement or some other altcoin movement (which 100% depends on Bitcoin 10.98% ) DON'T UNDERSTAND movement in general, because whenever some big green candle appears in downtrend they state " correction is finished" " Bitcoin 10.98% to the moon" etc.
They would not be changing their minds or statements in the matter of day or week if they would be able to see bigger picture.
This is bussines enviroment and in situations like this you better don't take advices from a guy who had C- from STOCKS :).
No matter people don't understand stock exchange, they can see if they portfolio increased or did not in past few weeks.
I belive drasticaly decreased.
That happends because when people are uncertain, they take advice from someone who stands out as "high reputated" or "expert" in order to make decision in their name.
And fails few times in a row, losing for example 50.000$ money.
What i m trying to say is don't bait stories about some big rebounce, some non realistic prices, because that WON'T HAPPEND ANYTIME SOON.
Bitcoin 10.98% needs to SINK and SINK ONLY in order to restore confidence on some price levels.
Even that this Bitcoin 10.98% apparently seems stable, (doesn't sink suddenly as it did for a few times so far which results pulling entire market down) but in general doesn't seem reliable at all.
Bitcoin 10.98% may remain on this price level for a few more days , but, trendline will be "tighter" which will lead to to break trendline .
When that happends, it will go all the way down to 5.800 level (there is a posibility that it drops even deeper), but we should see how strong 5800 level of support "reacts" in a situation of sudden dips as we could see few days ago (dip to 6000 level and rebounce to 8500 level).
Conclusion :
-Don't buy stories about bullish Bitcoin 10.98%
-Price will go to 5800 level (maybe even 5400 level, then 7500 level, then will bleed out all the way down to 3000 level
-Rebuy either on 5400 level, buy high volatile coin (XRP, XLM 1.16% ), when price reach 7500 level, cashout and wait for future dips
-If not doing so, most probably people will lose some percentage of their portfolio, because if they get caught in downtrend, if not cashing out, traders might lose around 40% of their portfolio.
-Don't let you self sink with Bitcoin 10.98% , cashout on time, rebuy on next dip, liquidate (cashout) after rebounce, and wait
-So far this Bitcoin 10.98% doesn't let altcoins to grow, but even if it remains calm, it may happend that altcoin could be " cut off" on half on uptrend which depend only if Bitcoin 10.98% will decrese fluctuation and apparently acts stable).
-It's a deceptive situation, this Bitcoin 10.98% movement, don't let your self to sink with Bitcoin 10.98% (or any other altcoin)
-Cashout before dips occur
Feb 9
Trade active: Bitcoin seems like "aiming for lower highs" forming tripple top, trying to leave an impression of being bullish, but that is a bull trap by it self on 8700 level, there is a additional resistance on 8800 level, this is why it's rebouncing and losing on value after each rebounce (RSI decreasing as well).
Once again, please be advised that 8200 level has been tested and failed to hold, we had rebounce from 6000 level which is not main support, it's 5400-5800 (zone) where "price dips" might be "compensated" , but anyway that zone has been reached and with each rebounce losing on strenght, this is why my personal opinion is that in a certain period when drops out of "channel" Bitcoin might rebounce once again from MAIN SUPPORT (5400-5800), but as it fails to form prices on higher lows (in a specific moment), it could start reversal pattern ignoring 5800 level (which will become unstable by being constantly tested) and it will failed to hold which may lead to Bitcoin 3000 price level.
Wheather people are criticising or no, Bitcoin will continue to move (most probably down) regardless some people are opposing to that. :)
It's a healthy correction and yes, its WIDE correction, because we are in general downtrend and it's unrealistic that someone turns bullish about Bitcoin untill proven otherwise.
Feb 10
Trade active: Bitcoin broke upper trendline, looks bullish, but it's just deceptive situation, things could turn bearish in a few hours time.
Don't gamble with your money, we could posibly see price reversal.
Don't get tricked by big change in % values" as we speak.
I'm not pesimistic, but this Bitcoin can (arfiticialy) grow more (i doubt once again).
If price goes above 9.000 level, dont' follow, wait for reversal (7.7-8.000 level), but dont buy at this price range.
Even if it makes new uptrend, no matter how far it goes, it will imminently fail.
milanjelic
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@milanjelic, Bitcoin 10.86% is still rebouncing in channel which goes under 45 degree angle, making BEAR FLAG as it is (while someone else thinks " Bitcoin 10.86% to the Moon" ) (otherwise they would not be buying).
People should pay attention as situation develops, because we DO HAVE IDEA ON GENERAL DOWNTREND ONLY.
Once again traders got bullish in a matter of hours.
They were bullish , then bearish since yesterday, then bullish again.
They do justify their actions as attempts to adapt to "new circumstancies- informations from television, twitter etc.
And that is why they get burned few times so far.
That means they dont have clear point of view when talking about Bitcoin 10.86% and that is downtrend and downtrend only.
Once again, there is nothing bullish about it
How long will it take?
When BItcoin 10.86% reach value of levels between 9000-9300 (now its downward pattern back to 8000 level as i m writing),
when that price level oppressed, it might cause sharp price reversal as Bitcoin 10.86% aproaches 9000 price level.
No matter how healthy Bitcoin 10.86% maybe looks like, it will start to "deteriorate" as trying to "push" 9000 level.
It possibly even push that level for several times, but my opinion is that Bitcoin 10.86% doesn't really has a strenght for breaching that level on the first price.
Second, having in mind we are BEARISH ONLY, there is no healthy reason to form higher prices at this point.
Btc 10.86% had one "push" to that level, failed to breach it and returned in a channel as we speak.
After several attempts, there is a 99% chance for strong price reversal (as Bitcoin 10.86% loses on strenght), rebounce from 9000 level all the way down 5400-5800 level).
Maybe Bitcoin 10.86% additionaly sinks because of FUD for few hundred dollars more, but 5400-5800 level is a good rebuy oportunity and my opinion is that we should possibly look for buyback at those levels, but not before that.
We need to see how high it could possibly rebounce when MAIN SUPPORT is heavily opressed as it will most probably happend.
even though I've been trading for quite some time I've never been the guy who actively posts trading ideas (disregard my only public trading idea > my daughter tried her best!).
Anyhow, many comments in recent days I've seen are getting more and more negative or at least people complain about everything - just following so called gurus / good traders but not adding their own ideas to it. For those I feel sorry because they never learn how to trade. The herds always follow! But hey, that's not my point here :D
I wanted to comment on the overall outlook of btc (trading crypto since 2016 - been through a lot already). Maybe you noticed that I am using mainly indicators not very common to most people, because most followers are stuck in a time capsule - they see the day, the week and maybe a month but never the big picture. Long story short - here is why I see the btc bullish on long. ***
(mixing up fundaments & technical backgrounds > sorry for that!)
1) BTC adapts on a nearly daily basis their lightning network > 1800 Nodes+ // SegWit integration is on it's way (Check box: BitPanda; Coinbase and a few more)
The biggest reason people complained about is the slow transaction speed + fees. Well, this will be a thing of the past once most bigger exchanges added these features, no matter if its SegWit or lightning network. The result will be surely faster and cheaper transactions.
2) Regulations and institutional buyers
We hear more and more that governments are regulating exchanges. Great! Less scams, less fraudulent ICOs, less corruption, less money laundry. Also, we see a heavy increase in crypto trading desk being set up in major financial corporations, interest spikes in many countries, city council and so forth to support btc (or blockchain, lol). Nobody has the luxury to miss this train - nobody! (btw. Looking forward to the 20th when the 'Petros' will be introduced!! Venezuela might after all have a great future ahead (10yrs+?).
3) PE vs NVT
Whereas the PE ratio is a major indicator to valuate a product on the traditional market the NVT is THE indicator to measure the value of a network and it's overall transactions throughput in USD. (similar to Facebook: No user - no value; many users - big value!). We see a clear trend reversal (charts.woobull.com/bitcoin-nvt-signal/) with the chance to dip a little bit more. The overall NVT ratio is still in its norm even with the huge increase in price in December! There is plenty of room to move north as seen many times before (please look at the huge divergence between price and USD network throughput; we had 2 major bubbles already and survived and I am not talking about Dec. 2017!)
4) Overall trend (log regression chart & weekly log chart)
Firstly, we are still on the 3rd wave and a small dip over a week or two won't hurt anyone -patience is King, as always. Since the 3rd wave looks for a higher high compared to the first wave (2013 - 2014) we are looking at 30K to 100K depending when the bulls start to run! The later we run the higher the price will go, that simple.
Anyhow, no matter if it's 4K, 5K, or 6K at the end of day we should just stay calm! BUT BUT BUT this will most likely not happen since we just saw a closed weekly candle alongside the bottom of the lower mid channel (log chart!). (pm/dm me if you don't know what I am talking about). Most big hands bought in the dip already (order books exploded with 100+ btc trades!) and those who missed it should buy around 7.2 -7.5K in my opinion, but hey! Do your own due diligence :D. Should the trend break the log weekly lower-mid channel we will see a bearish market for quite some time but honestly, this doesn't fit into nowadays euphoric and revolutionising crypto market. There is only room to grow not to shrink. We see billions of fresh money from ICO's in upcoming month, banks cashing in, private investors buying in and maybe even bigger institutional buyers but that all depends on ETF's - it's just a matter of time until the bulls are done with grassing. Off to new territories, right over the mountains to a new refreshing meadow!
The RSI on the weekly just moved east and tries to stay above 50. A sideway move for a week would be indeed very healthy. Reenergise a bit and off you go btc! Good boy.
Daily RSI ain't bullish but it doesn't have to be. There is no need to create more FUD due to growth many economists don't understand. Why? Because most economists studied in the last century where markets have been pretty much "isolated". Now we see the Bitcoin as a world-phenomena and no one can really grasp how everything will work out in the future and that is good thing! I hate it when you can guess the end half-way through the movie; boring, isn't it?
Should you buy? hell ya! When that's up to you!
*** and always remember:
We are all living in capitalism which seeks for non-stop growth no matter the pain it has to go through. (That's not my opinion but a fact) Money is printed with no value on a daily basis (thanks to neoliberalism in the 70's). Crypto's are small compared to the Dow Jones and others trading trillions, gaining trillions and "losing" trillions - who cares! As long as we are humans filled with fear, greed, arrogance and stubbornness we will always doubt ourselves and feel jealous about others no matter if we might lose our fortune and future!