BTCUSD: Continuation Pattern And Next Support Around High 6Ks?

BTCUSD update: Price is consolidating across the board and is poised to break lower in my opinion. While bearish momentum dominates in the short term, triangle formations such as the one developing in this market serve as continuation patterns.

If I shorted these markets (which I do not), I would be looking for a day trade at the break of 7312. This is just below the low of the previous candle which is an inside bar.

What makes situations like this difficult is when you are bullish on the long term. This is why it is so important to separate trade ideas by time frame. This means it is possible to be bearish on a day trade time frame, while simultaneously bullish on a swing or position trade time frame.

At S.C., we are long term bullish and are accumulating inventory across a variety of coins during this period of crowd pessimism. There are a number of articles there that explain which coins and our reasoning. Since I am able to separate and categorize my thinking in terms of time frame and strategy, I am able to recognize the short term intent which is not in line with the bigger picture.

On the short term, this market is dominated by bears. If price breaks below 7312, I am anticipating the mid 7100's to high 6900's before the next support asserts itself. Keep in mind, price is within a broad support zone that ranges from 8171 to 4983 (.618 support of entire bullish structure relative to the 150 lows). This means it has a lot of room to fluctuate before another low is established.

In summary, long term not much has changed. When the crowd hates a market, that is a great time to accumulate at wholesale prices. This does not come without risk though. Someone recently asked me, when you accumulate, where do you place the stop. These are risky instruments that are in a space that is not regulated that same way as traditional markets. If you are in it for the long term, then it is all about risk control though appropriate sizing and the willingness to lose. If you can't lose, you can't win in these markets.

As far as the next swing trade long goes, there is no reason to be long at the moment. We will issue a signal for a swing trade long, with specific stop and target on S.C. once the market provides us with a good reason.

Questions and comments welcome.

Comentário:

BTCUSD update: I am still short term bearish, long term bullish until this momentum shows clear evidence of shifting. I am long term bullish because this market is not making significant new lows. As far as long term Elliott Wave counts, this price action is equivalent to a broad Wave 2. If this market breaks below 6K, that would be more of a reason for concern and caution rather than outright bullish.

The current price action is within the vicinity of a support zone and is hesitating. This shows some susceptibility to a short term squeeze, but until I see further evidence, I am steering clear of any new swing trade longs.