Just when we thought it was safe to go back into the water, Goldman Sach's Sheba Jafari issues a warning to investors which spread like wildfire on the crypto fake news networks. Keep in mind these sites are all about clicks and not necessarily about news. From Business Insider, who released the story, these were the only statements from the letter in quotes.
"The break is significant as implies potential for a more impulsive decline," Jafari said. "The next meaningful level is down at 7,687-7,198; includes the 200-dma and a 1.618 target off the high."
"The 200-dma in particular is important given that it held very well at the previous low in September," Jafari's team wrote. "Getting a close break this time around would warn of structural damage, increasing the risk of new local lows (<5,922). At this point, need to get back through 9,322 (the Feb. 26th low) for this to stabilize."
This is not anything new. Matter a fact we posted almost the identical levels in our March 9th article where we were looking at 7666-7238 as "two extreme that are now definitely in play" and you didn't have to have 10 million with us to get the update. Matter a fact you received it a day before those that pay GS's for this information received it. So what about the 200 DMA? I am not sure this is a magic line, and actually if you sell the 200 DMA' you are often selling right at the buy level. One thing to keep in mind if there is statistical significant to a past indicator, it will probably not be reliable in the future or more likely you are being led by noise and price fitting. I remember my statistics/calculus professor stating, "I can use statistics to make an argument either way, and the statistics will back my analysis"! So be careful following simple moving average systems. Do to word constraints I have omitted the further analysis on the moving averages written elsewhere.
Technically nothing has changed since are post on the 9th other than I added the 8860 level as a key support level. Does this mean I am selling there? No! Just like those receiving the Goldman Sach's letter I am looking for an area to buy not sell. You sell at highs not lows. This is critical to keep in mind as this letter was for "Investors" not "Traders" so you must take the context of the letter into consideration. This could likely have been followed up with a "we are looking at these levels to add for the long term". Quite frankly so am I. I am also looking at the 9668 level to hold if we move higher. If we break the 8221 level this increases the odds that we move lower and as we said Saturday could likely test the extreme 7666-7238 area. This is a key area to look for a reversal as are all the levels we show. If we do not get a reversal we simply stay neutral to the market provides us a sign that the probabilities for a reversal are within our risk appetite and we position accordingly.
We are consolidating at the upper end of our original target area. Again this is not bearish. Sheba Jafari is just providing a letter to her "investors" an update (likely weekly) to provide some insight into the overall market conditions just as we do on a weekly basis. Believe me Goldman Sach's does not put out daily chart analysis, you get one letter a week and it is a vague overview. Now during the week if something happens they will get an alert similar to the ones we send, but this was a weekly market overview letter I'm sure of.
Do you think it is a coincidence that the only quotes "leaked" to the press were the ones that had the potential to put fear into the market? Have there ever been any causes to think the Goldman would try an manipulate the market to suit their own benefit?
"The break is significant as implies potential for a more impulsive decline," Jafari said. "The next meaningful level is down at 7,687-7,198; includes the 200-dma and a 1.618 target off the high."
"The 200-dma in particular is important given that it held very well at the previous low in September," Jafari's team wrote. "Getting a close break this time around would warn of structural damage, increasing the risk of new local lows (<5,922). At this point, need to get back through 9,322 (the Feb. 26th low) for this to stabilize."
This is not anything new. Matter a fact we posted almost the identical levels in our March 9th article where we were looking at 7666-7238 as "two extreme that are now definitely in play" and you didn't have to have 10 million with us to get the update. Matter a fact you received it a day before those that pay GS's for this information received it. So what about the 200 DMA? I am not sure this is a magic line, and actually if you sell the 200 DMA' you are often selling right at the buy level. One thing to keep in mind if there is statistical significant to a past indicator, it will probably not be reliable in the future or more likely you are being led by noise and price fitting. I remember my statistics/calculus professor stating, "I can use statistics to make an argument either way, and the statistics will back my analysis"! So be careful following simple moving average systems. Do to word constraints I have omitted the further analysis on the moving averages written elsewhere.
Technically nothing has changed since are post on the 9th other than I added the 8860 level as a key support level. Does this mean I am selling there? No! Just like those receiving the Goldman Sach's letter I am looking for an area to buy not sell. You sell at highs not lows. This is critical to keep in mind as this letter was for "Investors" not "Traders" so you must take the context of the letter into consideration. This could likely have been followed up with a "we are looking at these levels to add for the long term". Quite frankly so am I. I am also looking at the 9668 level to hold if we move higher. If we break the 8221 level this increases the odds that we move lower and as we said Saturday could likely test the extreme 7666-7238 area. This is a key area to look for a reversal as are all the levels we show. If we do not get a reversal we simply stay neutral to the market provides us a sign that the probabilities for a reversal are within our risk appetite and we position accordingly.
We are consolidating at the upper end of our original target area. Again this is not bearish. Sheba Jafari is just providing a letter to her "investors" an update (likely weekly) to provide some insight into the overall market conditions just as we do on a weekly basis. Believe me Goldman Sach's does not put out daily chart analysis, you get one letter a week and it is a vague overview. Now during the week if something happens they will get an alert similar to the ones we send, but this was a weekly market overview letter I'm sure of.
Do you think it is a coincidence that the only quotes "leaked" to the press were the ones that had the potential to put fear into the market? Have there ever been any causes to think the Goldman would try an manipulate the market to suit their own benefit?
Bitcoin is testing the 8860 level for a 4th time here. In addition the 0.618 retrace of the bullish wave has never been retested. This is just a be patient market and wait for the market to decide. One thing to keep in mind, after equities consolidate over a period of time the move is generally more reliable one way or the other.