The run over the last month has been wild, but during it there never really was a huge volatile candle like what we saw today.
It is this candle after a run up that makes you stand up and pay attention.
Signs of things to come or just a necessary flash sale?
There are a few things on the table here on why this big red candle that has rallied off the low was necessary and even a good thing.
The Futures Gap Fill
There was a big gap on the Bitcoin futures at 29,700 that more than got filled, which is good because there is another big gap down at 23,800 and a smaller one even below that.
Not all gaps get filled, this we know - but some do! The fact price filled one of the three since the explosive price move began is a good thing, because again, some gaps will get filled in the end.
Touch and go on the 10 day
You all know I love the 10 day moving average and the price spike down touch through it briefly before rallying off the lows.
I've said it for a while, as long as the price remains above the 10 day on a closing basis then the action is as bullish as it can be.
What about a potential top?
This is the other side of the coin. Have the bulls exhausted their hunger for now? Is there further profit taking? Will this be the new high for a while?
All these are questions that will be answered over the next couple weeks.
I can say this. I will be on high alert to see how it plays out because the last time we saw a move like this followed by extreme volatility it didn't work out so well. I don't think there is a high likelihood history repeats on this, but anything can happen.
The high put in yesterday will be a focus of mine followed by whatever near-term low is created. Let the trading commence!
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The problem with thinking this is the top is that there hasn't been any FOMO buying... only FOMO dumps. The buying is still institutional and being carried out with strong hands. The second I see price sloshing back and forth on a buying spree I'll be sure to take some gains.
No matter what... I'm going short in February.
Me gots a bad feeling.
On the other hand all these institutions know the price can still x10 from here... so they might not care and just keep buying at this level... who knows. We have amazing volume.
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Yeah, I don't have a strong opinion on either side. A run to 50K in the short-term could easily happen before any extended pullback, but who knows lol
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I think $50k is very likely if Biden takes office without incidence.
Even better... if he takes office with incidence... the whole "you need us, give us your freedom" narrative might pump the market as well.
There's seriously something to be said for these fast daily MAs - my BeatingBitcoin strat was actually partly inspired by yours and @buzzbeergeek's charting work back when ... blue is the 7 day smoothed:
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Yeah, this short term average has become my go to for short-term overbought oversold and trend following.
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At some point it needs to correct, right. I guess nobody knows for sure when though. I wouldn't even trade at this point and consider that ridding the bigger ways is more profitable than day trading or even on a weekly basis. It's probably that I am inclined towards this approach as I am not good at TA... Interesting to see what happens next with altcoins, are they gonna follow BTC or start acting on their own.
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Yep, I'm holding majority of my BTC long-term regardless and then have a small amount I would consider trading after any really sick rips, though this has been a good one.
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I guess that's the best strategy.
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I honestly agree that things are getting more and more interesting!
How much money can flow into Bitcoin? A lot.
I agree these institutional investors are strong hands,
I am not sure past behavior will predict future performance here. Bitcoin may evolved into something else before our eyes!
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Exactly, disruptor technology status is in full force for crypto. It is here to stay so growth is inevitable. Price will swing up and down along that growth.
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Bitcoin is really a roller coaster of emotions.
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I watch for candlestick patterns and would hold off until I see what happens with tomorrows candle.
I do feel this is showing the start of the market psychology changing but I need to see 1 or 2 more candles before I would make any move.
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Yep, today's candle is looking good, rally off the low after coming near the 10 day, so technically we are still in bull mode.
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We hope for bigger run ups, the fall a few days ago was shocking but the bounce back was even surprising. I expect nothing but a perfect running up.
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Yeah, I'm looking at big pullbacks as buying opportunities.
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Despite the 20% drop, this candlestick does not look so Bearish taking into account the size of the tail in relation with the body. I agree with you, we have to be cautious now but still this is not a sign of exhaustion IMO.
I may change my opinion depending on tomorrow's closure.
Man, I didn't realize my post had such a bearish tone! LOL. We can easily go to 50K+ before a major pullback. I'm just stay on alert is my thing.
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Your posts are always appreciated my friend ;-)
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STOPDo not miss the last post from @hivebuzz:
I think 40k might well be when a longer correction sets in:
https://leofinance.io/@tobetada/crypto-analysis-or-btc-35-40k
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Yeah, I believe we could see 50K before an extended pullback if this current move isn't one.
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@scaredycatguide Great post brother! I'll be following this one too! I bought a bit at the $31k mark and have been trading into Ether. I'm looking forward to seeing some more volatility!
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I am holding my BTC for the foreseeable future, but tempted to take my original capitol off the table, and let the profits ride. But I am unsure of what I would invest in besides Ethereum, and I already own a decent amount of that. I hope you will take a look at Ethereum soon and give your opinion about it.
Thanks
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