low-risk game plan for potential bullish reversal
מעודכן
not sure what the odds of a bullish reversal are here, but it doesn't really matter. here's how i plan on playing this with minimal risk:
(1) if price finds support and bounces off the trendline, i'm buying. this would appear bullish to me because (a) it would form an inverse head & shoulders pattern, and (b) this is our long term bull trendline. stop tightly below the trendline/shoulder line.
(2) at the top of the triangle, take a partial profit to hedge against a rejection. AND/OR wait for a rejection and sell for small profit.
worst case here is that the price never makes it to the top of the triangle, and you can either manually bail/break even, or hit the stop immediately below the trendline for a minimal loss (like 2%).
best case is a full on bullish reversal, and you can tell all your friends you're a genius for buying the dip. i do still expect a retest of that down trendline at some point.
(1) if price finds support and bounces off the trendline, i'm buying. this would appear bullish to me because (a) it would form an inverse head & shoulders pattern, and (b) this is our long term bull trendline. stop tightly below the trendline/shoulder line.
(2) at the top of the triangle, take a partial profit to hedge against a rejection. AND/OR wait for a rejection and sell for small profit.
worst case here is that the price never makes it to the top of the triangle, and you can either manually bail/break even, or hit the stop immediately below the trendline for a minimal loss (like 2%).
best case is a full on bullish reversal, and you can tell all your friends you're a genius for buying the dip. i do still expect a retest of that down trendline at some point.
הערה
for what it's worth, if this pattern plays out, i'll also be pulling the trigger on entries on alts. specifically looking for discounts on LINK, MANA, NANO, and SOL. remember, even if BTC only goes up to test some levels in the 40s, alts will follow, and pump harder. SOL has looked particularly strong to me during this correction/consolidation. i had been waiting for it to fall out of this wedge and was hoping for an entry closer too the bottom of the channel, but if BTC pumps, you can bet SOL will too and this would likely be the last time we see prices in the 30s (at least for a while).
needless to say, if this BTC idea fails for any reason, i'll be just as quick to close out those alt positions and take losses if necessary. market is too uncertain to take chances that you might otherwise take when it's trending.
הערה
just wanted to make the point that if we're operating under the assumption that this is an IH&S, and the neckline has this bullish angle, i might not expect the right shoulder to dip all the way down to the trendline (even with the left shoulder). just some food for thought. tripping on nested IH&Ses right now.
הערה
i'm assuming this bounce has looked a bit more bullish on account of the positive news out of el salvador, india, etc. such a fickle market. when there's news, or a well-timed tweet, technicals are less meaningful than market sentiment. we're basically back inside the symmetrical triangle/bear pennant, just like we were a few days ago when i was calling long, then had to scream to abort when price looked like it was going to break to the downside (which it did). i'll be looking at the exact same targets if price breaks above the triangle.
not going to attempt to suggest an entry here, do what you need to do, just don't FOMO yourself into a bad entry. i may pull the trigger at the bottom of the triangle (above the initially projected IH&S right shoulder). obviously that involves significantly more risk than the initial plan, because i'll likely keep the stop loss in the same spot, below the long term trendline (white).
הערה
potential stop levels to considerהערה
הערה
quick update now because i'll be busy tonight.more confirmation of the bullish trajectory of the neck/shoulder lines, so i'm still expecting the right shoulder to be closer to the green dashed line than the original projection. if support isn't established somewhere between those green lines, this whole idea goes out the window and we need to reassess.
if you decide to pull the trigger, USE STOPS and take modest profits at the nearest resistance (i'm eyeing the top of the triangle). remember the big picture: bitcoin is just as likely to do another leg down (into the 20s) as it is to break up into the 40s. and when it breaks, it will move fast. i still think 34500 and 33100 are good levels for stops, but once the right shoulder is established, a stop directly below it would provide the least risk (assuming your entry is directly above it).
should be an interesting 24 hrs or so...
הערה
i'm giving this a go. (1) taking partial profit at the top of the triangle in case of a rejection. i'm going to sell enough to make a little profit even if i hit my stop
(2) if price fails to break out above the triangle, i still see the possibility of a larger inverse H&S forming which could be traded with a similar setup. or use that 33100 stop if you're feeling lucky. remember, there is also the very real possibility that this will play out as a descending triangle with a break to the downside.
good luck!
הערה
don't forget to take profits
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