PUTS on COIN
הערה:
Did not get filled ):
הערה:
Order filled:
Expect this poor value low to get taken out. Market needs to probe for lower prices and complete the auction process. What does it mean to complete the auction process? Well it means that when the market wants to head lower, it looks for liquidity for buyers to come in. Price is an advertisement for participants to execute trades. At the double bottom, it found liquidity. There were enough buyers to stop the selling and move in the opposite direction.
However, the amount of volume that transacted at those levels means that there is some sense of fair value. Now that the market has deviated from that double bottom, fair value becomes less certain. Is it at the top of the range? The bottom of the range? Before continuing higher, the market needs to be certain that fair value is NOT at the lows. As a result, these lower time frame double bottoms typically get retested, and trend reversal form with higher conviction when a buying tail forms. This shows up as a buying wick on the candlestick chart. It tells a clear story. Prices were probed further into the downside, and a lack of continued sellers quickly reversed it back in the opposite direction. This completes the auction process and signals that the market did not find fair value at those lows.
Expect this poor value low to get taken out. Market needs to probe for lower prices and complete the auction process. What does it mean to complete the auction process? Well it means that when the market wants to head lower, it looks for liquidity for buyers to come in. Price is an advertisement for participants to execute trades. At the double bottom, it found liquidity. There were enough buyers to stop the selling and move in the opposite direction.
However, the amount of volume that transacted at those levels means that there is some sense of fair value. Now that the market has deviated from that double bottom, fair value becomes less certain. Is it at the top of the range? The bottom of the range? Before continuing higher, the market needs to be certain that fair value is NOT at the lows. As a result, these lower time frame double bottoms typically get retested, and trend reversal form with higher conviction when a buying tail forms. This shows up as a buying wick on the candlestick chart. It tells a clear story. Prices were probed further into the downside, and a lack of continued sellers quickly reversed it back in the opposite direction. This completes the auction process and signals that the market did not find fair value at those lows.
הערה:
Closed out these puts because BTC outlook still uncertain. I rather buy puts at a complacency bounce higher, or buy long dated calls at a sweep of the lows. I can definitely see some range bound motion occurring in the next month, and don't want to be a victim of theta. Rather make some moves when volatility is higher.
הערה:
BTC still indecisive:
הערה:
הערה:
Glad I got out of those puts while still in profit. COIN looks to attack the range high again: