Bitcoin is at the moment great to trade because of the volatility. When trading smaller timeframes the chances of forgetting the bigger picture increases.
I think that analysis paralysis is one of the big problems for daytraders, so I thought of making a high timeframe analysis since that shows the current trend better.
As you see on the 3day chart, the trend is clear. It is down so the chances of making lower lows are higher than higher highs. When longing the bounces, taking profit is a priority.
On the 3 day chart I see a nice bounce of low 3000 zone to low 4000 zone in 4 days. I think this is just profit taking of shorters above 6k as we dropped 50% and it is a logical spot to lock in profits.
Even though the bounce was strong I don't think this is the low yet.
The RSI on the 3D chart shows a clear downtrend, I think it will break the downtrendline, but stay below 50 value and that can be considered a lower high on the RSI. If that happens the chances of making a lower low in price increases.
Another note is that 2980, the September 2017 low, or basically 3k psychological level is important because I can see capitulation behaviour panic if we break that. We will have 2 selling forces, the people that bought 3xxx will trigger their stoplosses and liquidation of leveraged traders with their liquidation below 3000.
I see us stopping at the first bull wave cluster at the low-mid 2k zone. before we get a bear market rally.
I see a short opportunity with
entry at 4080-4170
stoploss 4501
target 2180-2380
R:R is 4.52
This trade should take around 2months to work out
Trade safe!
I think that analysis paralysis is one of the big problems for daytraders, so I thought of making a high timeframe analysis since that shows the current trend better.
As you see on the 3day chart, the trend is clear. It is down so the chances of making lower lows are higher than higher highs. When longing the bounces, taking profit is a priority.
On the 3 day chart I see a nice bounce of low 3000 zone to low 4000 zone in 4 days. I think this is just profit taking of shorters above 6k as we dropped 50% and it is a logical spot to lock in profits.
Even though the bounce was strong I don't think this is the low yet.
The RSI on the 3D chart shows a clear downtrend, I think it will break the downtrendline, but stay below 50 value and that can be considered a lower high on the RSI. If that happens the chances of making a lower low in price increases.
Another note is that 2980, the September 2017 low, or basically 3k psychological level is important because I can see capitulation behaviour panic if we break that. We will have 2 selling forces, the people that bought 3xxx will trigger their stoplosses and liquidation of leveraged traders with their liquidation below 3000.
I see us stopping at the first bull wave cluster at the low-mid 2k zone. before we get a bear market rally.
I see a short opportunity with
entry at 4080-4170
stoploss 4501
target 2180-2380
R:R is 4.52
This trade should take around 2months to work out
Trade safe!
