Bitcoin - July 21, 2020 (Short)

21 de jul. de 2020

BTCUSD

Hello everyone,

Back with another update.

Yesterday I promised to have a look at the 3-day chart.

What I wanted to point out is that ever since June 20 the 21-period (3-daily) EMA (blue curve) acts as support.


In addition, notice

1. how the following oscillators (3-daily) are all bottoming out:
* RSI (magenta)
* Stochastic RSI (grey/black)
* MFI (cyan)

2. how the Bollinger bands on the RSI are narrowing


Finally, notice on the ADX chart, how both Directional Indicators (green: measuring the buy-pressure ; red: measuring the sell-pressure) have been decreasing since May 6.
Meaning: there is no real action in the market, because no-one is willing the buy and no-one is willing to sell. Consequently, liquidity is very low and it is easy to move the price up or down by a few 100 dollars.


All of this (together with the red-to-green flip on the TD Sequential) led me to believe that a break to the upside was around the corner.
Turns out I was right. Unfortunately, BTC outpaced my :-)

Now, what does this mean?

Don't let FOMO get you. I've seen many YouTubers brag on how BTC is doing exactly what they predicted and how BTW is definitely going to moon now.
Well... I disagree. In my opinion: this move means nothing!

Notice that BTC has bounced off the 50-daily SMA and the 21-period 3-daily SMA. The 9,400 level will be serious resistance.
Furthermore, look at the volume. It's not bad, but not great either. And it's already declining.
In addition, we printed a green 9 on the hourly TD Sequential.

So, in my opinion, this is yet another fake out and we're more likely to revert and drop, than to keep going higher.

Therefore, I revise my opinion downwards to SHORT.
Not financial advise: I plan to enter a short, with a SL just below 9,400 (to beat everyone that will set their SL at 9,400).
The 9,250 level an the top of the (black) descending triangle (which we broke out of) will act as support, so those are good levels to take profit.
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OPINION (revised downwards): BEARISH

ANALYSIS (updated):
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* On July 21 we broke the resistance formed by
i) the (black) descending triangle;
ii) the 21-daily SMA and EMA;
iii) the 9,250 level.

* Volume is moderate and decreasing.

* We hit resistance at the 50-daily SMA and the 21- 3daily SMA.

21 de jul. de 2020

Nota

Quick update

Today's high of 9,443 lines up with the .382 Fibonacci retracement (from tha ATH to the 3k bottom).

As long as we do not break, with convincing volume,
* the previous high (9,480) of July 8; and/or
* the long term descending trend line (magenta) at around 9,500,
I will not change my bearish bias.

However, when that happens, I will flip to bullish, for sure.