Time to dust off my TA on some BTC!

in #bitcoin2 years ago (edited)

Here's how I'm viewing the TA on BTC


In short, a convergence of potential supports, each of them having a history of being support enough, in and of themselves, to cause price action to pivot into a new wave up in bullish trends.

The aforementioned supports that are converging near the same price:

1.) AB = CD pattern
Corrective waves often repeat in terms of the amount of price that they drop. In this case AB would equal CD at around $41,500.

2.) Testing a major "local high" (LH)
Testing what was once a major price pivot (to the downside) - a strong resistance in the past (strong resistances tend to become strong supports)

3.) fibonacci, 38.2% retracement, between all-time high (ATH) and cycle bottom (CB)
This percent of retracement tends to act as a strong support in a strong bull market.

4.) close support of the 200 day "simple moving average" (DSMA)
The 200 day average of BTC closing prices sits currently at around $39,700. This also tends to act as strong support in a strong bull market. The fact that it has never yet been tested in this bull market cycle could mean that a test of it is imminent. One would expect that we at least get a decent bounce out of this first test.

In total

So that's 4 major supports all converging within about a $1,000 zone, and it's an even smaller range if we leave out the 200 DSMA (under $500 range). That ain't bad. You don't see that much convergence of support/ resistance in any market that often, which means that this could be a ripe opportunity for taking a swing trade position and/or long-term position.

Of course, it should go without saying, but I'll say it anyways, we can never be sure how a market will behave, should the price come down to these support zones. There's no guarantee that any of them will be able to withstand the selling pressure, or even that they'll provide a significant "bounce", be it of the "dead cat" variety or any other.


I threw up an idea for how to trade this set-up, as a swing trade position, with a stop-loss just under the 50% retracement level (between CB and ATH) and a "take profit" at the ATH. The reward to risk (R/R) is a few points shy of 3 to 1, which isn't too shabby.

Obviously, you could make for a better R/R by tightening the stop, but then you're also more likely to be "stopped out".


Congratulations @jamesbrown! You have completed the following achievement on the Hive blockchain and have been rewarded with new badge(s) :

You received more than 12000 HP as payout for your posts and comments.
Your next payout target is 13000 HP.
The unit is Hive Power equivalent because your rewards can be split into HP and HBD

You can view your badges on your board and compare yourself to others in the Ranking
If you no longer want to receive notifications, reply to this comment with the word STOP

Check out the last post from @hivebuzz:

Hive Tour Update - Account creation and Account Recovery steps
Support the HiveBuzz project. Vote for our proposal!