Hello Everyone,
In my yesterday’s post, I mentioned why bulls must 'Stay alert'.
In this post I would like to explain why I said that and why I went short on BTC.
1) Fib circle called for the cycle top:
I have been using this one Fib circle to trade BTC for whole 2020, using this circle I made a prediction of 19000 $ BTC by Dec 2020 back in Jan 2020 (check the linked idea below).
Recent parabolic run in BTC brought it to a key 1.618 Fib circle.
This 1.618 Fib circle was responsible for, a) BTC capitulation drop from 6500 to 3150 back in Nov 2019, b) start of a BTC parabolic run from 5000 to 13000 in May-June 2019, and c) BTC bottom at 4200 in March 2020.
So it was logical to think that when BTC approached this circle again it could face sharp rejection.
2) Old pitchfork (PF) called for the cycle top:
Similar to the Fib circle above, I have one PF on my chart which covers almost all of the BTC price action.
As you see in the chart below, the mid line of this PF has been a crucial SR level for BTC price whether it was 2017 run or 2018 crash.
Yesterday BTC also came to this level and tapped it perfectly.
3) Shepherd and Swing sell signal:
On the indicator side, the Shepherd indicator further confirmed the resistance area for BTC from its sell signal set ups on 6hr and 12hr TFs (Shepherd trend line in Aqua color started curve down after facing resistance). This sell signals made short-term bearish bias valid.
On the Swing indicator, 15min TF gave a perfect short setup form the ‘Swing Bear’ signal.
Old levels of support and resistance identified from the fib circle and PF and sell signals from Shepherd and Swing are the simple reasons why I went short yesterday.
4) Next key level to watch:
Of course the next question would be how low it can go? and when to get in?
Based on the PA data we have, I still think this is just an intermediate cycle top and BTC could start to climb back up once this correction is over.
As a bottom of this correction, I think 13200-13500 will be a key area. This is the approximate top BTC put in June 20119, this is also a next key fib circle (1 Fib circle), and if we plot a fib retracement on the recent BTC move then the Golden Fib Pocket also comes in this area.
All this confluence makes 13200-13500 a very good area of support and we could expect some strong moves from this area.
*If* this area to fail, then my next target is the 3D-Trend Maker ribbon (Red ribbon). This ribbon is a very crucial and has proven to be a strong SR level.
Let me know in the comments if you find this info helpful.
Happy and safe trading…
Chao…
In my yesterday’s post, I mentioned why bulls must 'Stay alert'.
In this post I would like to explain why I said that and why I went short on BTC.
1) Fib circle called for the cycle top:
I have been using this one Fib circle to trade BTC for whole 2020, using this circle I made a prediction of 19000 $ BTC by Dec 2020 back in Jan 2020 (check the linked idea below).
Recent parabolic run in BTC brought it to a key 1.618 Fib circle.
This 1.618 Fib circle was responsible for, a) BTC capitulation drop from 6500 to 3150 back in Nov 2019, b) start of a BTC parabolic run from 5000 to 13000 in May-June 2019, and c) BTC bottom at 4200 in March 2020.
So it was logical to think that when BTC approached this circle again it could face sharp rejection.
2) Old pitchfork (PF) called for the cycle top:
Similar to the Fib circle above, I have one PF on my chart which covers almost all of the BTC price action.
As you see in the chart below, the mid line of this PF has been a crucial SR level for BTC price whether it was 2017 run or 2018 crash.
Yesterday BTC also came to this level and tapped it perfectly.
3) Shepherd and Swing sell signal:
On the indicator side, the Shepherd indicator further confirmed the resistance area for BTC from its sell signal set ups on 6hr and 12hr TFs (Shepherd trend line in Aqua color started curve down after facing resistance). This sell signals made short-term bearish bias valid.
On the Swing indicator, 15min TF gave a perfect short setup form the ‘Swing Bear’ signal.
Old levels of support and resistance identified from the fib circle and PF and sell signals from Shepherd and Swing are the simple reasons why I went short yesterday.
4) Next key level to watch:
Of course the next question would be how low it can go? and when to get in?
Based on the PA data we have, I still think this is just an intermediate cycle top and BTC could start to climb back up once this correction is over.
As a bottom of this correction, I think 13200-13500 will be a key area. This is the approximate top BTC put in June 20119, this is also a next key fib circle (1 Fib circle), and if we plot a fib retracement on the recent BTC move then the Golden Fib Pocket also comes in this area.
All this confluence makes 13200-13500 a very good area of support and we could expect some strong moves from this area.
*If* this area to fail, then my next target is the 3D-Trend Maker ribbon (Red ribbon). This ribbon is a very crucial and has proven to be a strong SR level.
Let me know in the comments if you find this info helpful.
Happy and safe trading…
Chao…
