Bears Regain Control

BTCUSD, bears regain control

Tl;dr
Orange coin good
Number go up

We, at MekongMonkey, are bitcoin bulls. There’s no need for technical analysis to come to this conclusion. Read The Bitcoin Standard; or, if you are more into numbers than words, take a look at the Stock-To-Flow Model.

As a trader, I don’t care about where the price is going in the long term. Trading is a way to generate income in the short term. We play a game of probabilities where we use data from the past to make (hopefully) well-thought-out bets on future outcomes.

The last weekly candle closed right above the weekly 21 EMA, which was exactly what I wanted to see to keep my short-term bullish bias. A couple of hours later, though, BTCUSD was rejected by it, dropping quickly to weekly support at 8800. It’s crucial to abandon old ideas when faced with new information. So I closed my long and flipped short. Based on the 12H chart, I entered at around 8800, aiming at 8200 to take profit with a stop loss above the 12H 21 EMA (yellow line).

Joining Team Bear

Zooming out to larger time frames provides more evidence for the bearish case; on the daily BTCUSD is falling away from the 200 SMA (white line). Only the 200 EMA (red line) at 8700 is still providing support on the daily chart.

On the 3-day, we had an open and close below the 21 EMA (yellow line) as well as a fresh Stochastic cross to the downside, completely invalidating our previous bullish idea.

The weekly also is dropping away from the 21 EMA again (not pictured here).

When we zoom out to the monthly (picture above), we see lower highs and lower lows for the past three months. BTCUSD can do some more ranging between here and 9100. Still, after the break of 8800 resistance, the next stop is most likely going to be first 8500, followed by 8200, unless the bulls can make a remarkable come-back. I would only consider the bearish case invalidated if we close, at the very least, a 12H candle above the massive resistance zone at 9500.

Bears Regain Control by MekongMonkey on TradingView.com

Follow MekongMonkey on TradingView for updates on this idea and to receive notifications whenever a new idea is posted. Please note, this is not trading advice. Watch your parking meters, don’t follow leaders, and always do your own research.

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