Bitcoin: No Setup No Trade.

2021年2月28日

Why is the Bitcoin pullback not turning higher? Did you buy the retrace because the hashtag was trending on Twitter? These are the type of moves that expose those who talk a good game from those who know what they are doing. We shared an aggressive swing trade long idea that required Bitcoin to push 48,500 in order to become active. The price was never touched which helped our followers AVOID getting caught in the persistent bearish momentum. Preventing negative trades is JUST as important as participating in positive trades when it comes to generating consistent returns over time particularly for short term oriented strategies like swing trades.

As I wrote previously, the recent impulse move from the 34K area which peaked at the 57K inflection point contains 5 subwaves. Whenever you can clearly count 5 waves in an impulse, the party is usually OVER. What makes this corrective move even more concerning is the magnitude of the previous wave. From the March low of 3K to the 57K peak, a broad Wave 3 impulse may be complete, now that Wave 5 of 5 of the broader 3 appears to be established. What this means for those not familiar with Elliott Wave, if the coming correction wave is the broad Wave 4, Bitcoin could get stuck in a consolidation for the next 3 to 6 MONTHS or longer. Just like Gold from the August peak.

Fake outs, false starts, false breakouts, failed highs and lows are very common in consolidating environments and the gold chart offers a very good example. Consolidations are not impossible to trade through but they are NOT an easy money environment. Knowing how to adjust expectations, identifying key levels and knowing where to place profit targets will separate the inexperienced from the experienced. Another thing to keep in mind is: IF Bitcoin goes into such an environment, most of the alt coins WILL follow. For this reason, signals on alt coin charts carry MUCH less weight.

Current support is 40K. If price stabilizes there, we look for a swing trade setup. If 40K is taken out, we look to 37K for the next potential location for a long setup. If 37K is taken out, the broad Wave 4 is likely is play.

Logic, news, oscillators, and "expert opinions" are useless if you are unable to separate your own decision making process from the inherent faults of human nature. There are brief periods where no matter what you do, you win (like the bullish trend in December and January). These periods reinforce behaviors that typically produce random results (JUST like when you win at a casino) and is often why you will see many new gurus come about. If you want to keep any profits that you made randomly, I suggest you take the time to comprehend markets from a behavioral perspective.

Thank you for considering my analysis, I hope you found it helpful.