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The case for a short-term rally to 15K (with Weiss Rocket Fuel™)

BITSTAMP:BTCUSD   Bitcoin / Đô la
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We've solidly settled the recent 10K bottom, and finally popped above the major 11,100 S/R line (from the big ATH selloff bottom). Next challenge is breaching the yellow downtrend shoulder line at 12K, which also happens to be where the pitchfork median is waiting. Note the red circle both here and back on Jan 2nd when we rallied from the same crossing point. **If that breach fails** this entire forecast is invalid, and we're going to slump hard...

Plenty of bulls have been hoping for a return to the pitchfork channel top, and I've been skeptical given all the bearishness lately. Bulls have had no juice on bounces, while bears have succeeded in dumping hard and fast every time. But there's something happening in a few hours which might just provide the psychological rocket fuel for the bulls: Weiss Ratings is about to release the first grades by a ratings agency for cryptocurrency. Now I have exactly no clue how significant this is really, I'm not savvy about ratings agencies whatsoever. No clue how the wider market will view this. But what I do know is that crypto bulls are OBSESSED with news that "legitimizes" crypto in the financial industry. Real-world use cases, ETFs, Futures , positive statements by governments, etc. Just look at the recent mania with XRP -- the idea (however oversimplified) that "banks are using ripple!!" was enough to fuel a huge pump. Bulls are desperate for good news. This might just be enough ;)

So while my other recent charts have been already been sketching a path to a new bulltrap just under 14K , I've honestly been skeptical of my own forecast. But I decided to take a clean look at the fibs and see what was plausible from a TA perspective (before I even heard about the Weiss stuff in the chat).

Quite simply, a 15K max target would put us right at the 0.705 OTE retrace of the entire selloff since the 17.2K bulltrap. And it's also nearly identical to where the 1.618 fib extension sits (of the rebound from 9-13K). So you've got two major movements with overlapping retrace (and extension) fibs. The rebound from 9K even hit its own 0.705 OTE buy zone perfectly and is starting the rally from there. Yes, this formation would become a big bearish Gartley all over again, so I'd expect a similar fall from the new 15K bulltrap back down to the intersection of the pitchfork median, 50% fib, and the new brown rising triangle bottom.
Bình luận: Of course, their website crashes minutes before the release ;) If they even have an IT department, they're all getting flogged right about now...
Bình luận: Report is out, would seem EOS, ETH, NEO ADA, and STEEM are the favorites in the "B" grade. Bitcoin at least made a respectable "C+" for hodling ;)
Bình luận: Sooooo, STEEM had a nice little bump, ETH too -- but so far bitcoin doesn't seem to be caring at all about Weiss grading. Guess if we go up from here it will just have to be TA ;)
Giao dịch đang hoạt động: Crawling up slowly from the wiiiide-bottomed reversal ;) Still higher highs, higher lows. Each leg retraces hard, but solidly hits the fibs.
Giao dịch đang hoạt động: If I was a weatherman, I'd be forecasting lots of sun with low heavy clouds, clearing up in a few days ;)
Bình luận: NOTE: there's a perfectly good chance we won't reach escape velocity right here, and might need a recharge on the triangle bottom before breaching the top. Doesn't mean the rally is over, just a quick touch in the 10,500 zone again. Don't be spooked unless the whole triangle collapses :P and if you missed the cheap coins, here's your second chance ;) If you already bought at the local 10K bottom, then just hodl and relax!
Giao dịch đang hoạt động: First attack of the Red Zone (downtrend shoulder line and fork median) where the rally could break through. Would be the most bullish scenario, of course. We could fail here on the firs try, drop to the triangle bottom and try again too, but would probably result in a lower peak target later.
Giao dịch đang hoạt động: First attempt denied, now we have some rebound options for exiting the triangle -- the major 11,100 resistance has now become support, we could have a short pullback and punch thru on the second attempt, or we could drop all the way down to the triangle bottom (10,500 zone) before picking up enough steam. Bull scenario is still viable as long as we don't fall out the triangle bottom. We're basically just killing time filling out the triangle tip waiting for a strong impulse move
Bình luận: Yes, all this tepid ranging with no impulse, is most likely due to the market sitting on its hands waiting for the CME futures contract to expire tomorrow (Jan 26th)
Giao dịch đang hoạt động: I'm not an EW guy, don't expect me to debate the finer points of wave identification, but this is how a 5-wave impulse to 15K could play out here. Also notice I should have drawn the red circles more as ovals, but just like last time, there was a first attempt to breach the downtrend and then we hugged it until popping a little later
Giao dịch đang hoạt động: Expect stop-hunting and whiplash. Look how much chop we had in the previous red circle -- and yet we rallied hard afterwards. Ignore the calls for doom, that only applies if we actually busted the triangle bottom :P
Giao dịch đang hoạt động: Sooooo, just hours before CME futures expired, and *right* at the moment we were breaching the triangle top - rumors started swirling about a Japanese exchange getting hacked to the tune of 700 million dollars o_O It wasn't even about bitcoin, but a bunch of NEM that got sucked out of hot wallets, because the idiots weren't keeping client funds safely in cold wallets :(

Of course the similarities to Mt. Gox are obvious, so the market freaked out and dumped vertically -- but stopped right at the triangle bottom, so one could say "we were going there already". Sure, but if you want to ensure a swift panic crossing of the triangle, you couldn't pick a better motivator than carefully-timed asian heist FUD :P

Anyways, folks got another chance to catch 10,300 coins, and we're rising up to the top again for another attempt at the trend line. Notice the similar contention on Jan 1-2 where there were multiple attempts to breach, and even a sizable pullback, before finally crossing and taking off. We could be doing the same in this red circle now. As long as this triangle is still in play, the bull forecast is viable (though if we take too long 15K won't be within reach on the channel top)
Bình luận: It took three kisses and a lot of hugging, but the bulls have been persistent ;) And even if the Weiss ratings fell mostly flat, the market has also been churning with other news, including futures contracts closing and new ones opening. It would seem the futures are far more bullish this time, with long positions more than double shorts :)

We've breached the long downtrend shoulder line since 17K, and now are just paused on the pitchfork median. Expect much more buying volume soon...
hey @ronfkingswanson , although we are in consolidation phase now, we don't mind getting an update. Have you closed the trade?
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Does anyone have any idea why Coinbase charts are so different from Bitfinex? The price is a lot higher on Bitfinex. Why? Which charts are most traders looking at?
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anthonyk2 rev214us
@rev214us, probably people converting tethers to BTC, causing it to pump higher on Bitfinex and Polo?
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@anthonyk2, also on binance it is higher. there were some rumors of tether printing money.
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Urbanmove rev214us
@rev214us, If you use the trading view feature that lets you Compare or Add symbols - ( right click any chart, choose that option from the menu ) you can over lay all the different BTC or XBT tickers from all the exchanges and load them on one chart. Use a square wave display to make it more legible. Give each exchange data a unique color. If you do this you will see that Coinbase used to have the highest prices of anyone.
This is controlled by the exchange, and not by the traders. Most people think the traders at that exchange are too stupid to realize prices else where are different. This is not the case. The exchange can create an artificially higher price by committing to micro trades on its own exchange that lead prices higher or lower in a given direction. Depending on how much money they are willing to throw at said attempt, usually 1x or 2x per day they must return to parity, and re balance their own book of micro trades, and carried positions. As I said, GDAX attempted to have the highest price as a way to deter that traders would not move assets away from their exchange. So this strategy worked for a while, until BTC imploded. Now they have stopped trying to lead the market, as they have realized it is a costly strategy when prices ultimately go against you and you have an enormous loosing position on your books from bad accumulation. In any case. To answer your question, you should be looking at your exchanges data and always be comparing it to all the major market leaders. In this base it is Bitfinex , Poloniex, Bittrex, Binance etc. And more particularly to the coin your trading. The exchange that handles the most REAL trades, not fake micro trades , is the exchange you want to use as the real price or the true benchmark. But ultimately your exchange price is what is going to matter for you.

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rev214us Urbanmove
@Urbanmove, Thank you for the info.
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Thanks for the update! Great work
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@ronfkingswanson Love the Ron's Rules of Entanglement :DDDD So true, though I'm still bearish, that bull trap made me so cautious. Hope I'm wrong ;)
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hi ron! can you please elaborate on why are you so fond of using the 705 retracement? :)
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ronfkingswanson thebumtrader
@thebumtrader, obviously it's not a traditional fib ratio - but I picked up on it from an old-timer trader around here, and have been surprised to find how effective it is for setting order targets
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