Bitcoin: Test Of 60K Again?

Bitcoin continues to maintain its consolidation, halving appears to be a non event which again is typical. The actual catalyst (institutional buying?) has been STOPPED for at least a month. If anything, I suspect large players who instigated the "run to 100K" nonsense have been quietly reducing their exposure into the hands of the retail trader. That may be one reason why prices have not pushed beyond the 73K high in over a month, yet many promised by now we would we at 100K or higher. Is Bitcoin setting up for a broader correction or is the test of the 60K area a buying opportunity?

The answer to this question will depend on the time frame you are considering. From the swing trade perspective, any bullish reversals between 60 and 62K are a short term buying opportunity, NOT an investing one. Profit potential can be measured from the 65 to 68K resistances. Right now price clearly shows buying activity (see lower blue arrow) at the 60K support. This is where you would consider buy signals on smaller time frames while keeping expectations realistic. A retest of the 73K high is still possible but price has a lot of resistance to clear which can take time.

If you are considering the investing perspective, look no further than the weekly or monthly time frame. Large red candle is still in play. IF Bitcoin closes out the month in this configuration, and the low is taken out, (58 to 60K) then a broader retrace becomes likely. In fact, based on the current minor resistance (previous support see upper arrow), price appears to be poised to test the 60K area this week (see illustration on chart). A momentum confirmation will be a close of the current candle and break of its low.

IF the support area is cleared, the possibility of the mid to low 50Ks becomes within range. In my opinion this scenario is more likely simply judging from the monthly time frame. Bitcoin has not been in a corrective cycle for months and vertical markets are NOT sustainable. Investing risk is still very high until we reach some supports on the larger time frames.

Whether you trade or invest, to be effective, you have to look at everything in terms of probability and risk. I was reviewing some conversations in my community about the recent Bitcoin action and I noticed traders say things like "I expected Bitcoin to do this". That is like saying "I expected the slot machine to pay me out after I fed it this much money". Instead of "EXPECTING" which implies certainty, the statement should be "I believed there was a greater PROBABILITY that Bitcoin was going to do this, for reasons X,Y and Z". The first statement is "closed" and not a good fit for an environment that is MOSTLY RANDOM. The second statement is "open" which embraces UNCERTAINTY.

By "thinking" you know what the market will do next, you imply you are smarter than the market and unless you have inside information, you are NOT. This means MOST of the time you will be operating at a 50% win rate. To succeed in such an environment, the focus must be on a greater reward/risk ratio, NOT a greater win rate.

Thank you for considering my analysis and perspective.