Bitcoin: Sharp Recovery Trend Still Bullish.

Bitcoin had an interesting week. In my previous article titled "Watch For 90K" I warned that 90K could be tested and if broken would introduce new support levels to watch for. The upper arrow on the chart points to the fact that there was NO reversal confirmation on this time frame during the time of the 90K test. No confirmation means NO longs. Confirmation eventually came AFTER testing 78K FIRST followed by the establishment of a bullish pin bar (second arrow). If you were looking to buy into this dramatic retrace, THIS is what you had to wait for in order to enter a swing trade that had market defined risk along with a much higher probability that price would go your way.

Once again NO ONE saw 78K coming. This is WHY you CANNOT step in front of levels with limit orders, etc., especially if you have no risk controls. This is also why it is best to "listen" to the market, not people. This refers to looking for swing trades NOT investing. The pin bar high is around 85K, the low 78K. The risk presented by the market is 7K points which is A LOT. You can mitigate risk in these situations by working with smaller positions etc. While it may be frustrating to watch the market bounce off of 78K and missing this bottom on this time frame, it is more effective to wait in the long run. The goal should be to align with probabilities NOT pick random tops and/or bottoms.

Another key point to consider: The 90K break and 78K test does NOT change the trend on the broader magnitude. This may still be a Wave 4 since the Wave 1 high was NOT overlapped at 65K. Also the bullish reversal was sharp (v bottom), whereas in a very bearish situation, price usually consolidates near the low only to break lower (momentum continuation). With this in mind, I do not anticipate another test of the 78K low or lower low. Minor retraces back to 90K or higher 80Ks is where I anticipate a higher low to evolve.

This perspective is not to be confused with investing. This situation offered some investment opportunity in my opinion but you have to have a structured dollar cost averaging plan which I have talked about in previous articles, streams, and beyond the scope of what I am writing here.

From here, I am looking for minor retraces for swing trade longs. While the low 90K area should be acting as a resistance, this is NOT an attractive area for shorts on larger time frames because this is just a large consolidation and price is still fluctuating in the lower part of the range. My plan is simple: wait for minor retraces into the low 90K or high 80Ks for long setups.

Thank you for considering my analysis and perspective.