Bitcoin continues to maintain the broader support around the low 80Ks. While this formation appears to be a lower high consolidation (bearish), it could also be the key inflection point for a reversal back into a bullish structure. This possibility aligns with the broader bullish trend which is still bullish AND with a Wave 5 scenario which I have talked about numerous times.
The broader trend that I am referring to is the bullish structure from the 126K high back to before the 73K breakout. This is the dominant structure, NOT the retrace from the 126K to 80K which is the short term trend. It is important to always consider the market from both sides of the argument. The bear argument in terms of wave count: since 88K has been overlapped, the current move is potentially a Wave 2 of the broadest magnitude. If this is true, Bitcoin has room to retrace back into the 60Ks (roughly 50% retrace from highs). The bull argument: 88K has not been overlapped for long, in fact price is very reluctant to stay below this level. 88K was the price I determined as the Wave 1, Wave 4 overlap of this broader 5th Wave that peaked at 126K. If price refuses to break lower (80K support) then it will be signaling that this is likely the beginning of the broader Wave 5 of 5 which can see a move beyond 126K over the coming months.
I agree Wave counts can be confusing and are only crystal clear after the fact, but that is not the point. The point is we can formulate potential scenarios that require confirmation by the market. If 80K breaks and price cannot swiftly retrace, then the bearish argument gains traction and price is likely in the Wave 2. IF 80K holds, and we are breaking back into the 90Ks, especially 95K resistance, then the bullish argument is in full swing.
Again this information is NOT to be used as a concrete forecast. The MARKET does what IT WANTS WHEN IT WANTS. We listen, adjust and manage risk. This information can be used as a general roadmap to anticipate further moves based on the confirmation the market offers. For example, if the bullish breakout scenario unfolds, it would make sense to expect more from longs. This includes things like: aggressive profit objectives (3:1 or greater), scaling into supports because they are more likely to hold, etc. Also expecting less from shorts, or not shorting at all, etc. Only you can decide how to adjust your strategy based on the context of the environment.
Also what makes this situation more compelling is the fact that the macro environment is strongly supportive. Lawmakers, the biggest banks and companies all innovating, investing, and betting huge in this space. On top of that, we have a government that is extremely Bitcoin friendly and setting us up for future rate cuts. CPI "officially" came in at 2.7%, less than expected which bolsters the argument for more rate cuts, perfect for the upcoming YESman, I meant Chairman of the Federal Reserve. Think about it. Remember, short term sentiment prices in the future based on only what it can process in the moment AND it is highly irrational. This is where short term mis pricing come from along with compelling lower risk opportunities you just have to have the confidence in your ability to recognize them.
Thank you for considering my analysis and perspective. Let's goooooooooooooooo!
The broader trend that I am referring to is the bullish structure from the 126K high back to before the 73K breakout. This is the dominant structure, NOT the retrace from the 126K to 80K which is the short term trend. It is important to always consider the market from both sides of the argument. The bear argument in terms of wave count: since 88K has been overlapped, the current move is potentially a Wave 2 of the broadest magnitude. If this is true, Bitcoin has room to retrace back into the 60Ks (roughly 50% retrace from highs). The bull argument: 88K has not been overlapped for long, in fact price is very reluctant to stay below this level. 88K was the price I determined as the Wave 1, Wave 4 overlap of this broader 5th Wave that peaked at 126K. If price refuses to break lower (80K support) then it will be signaling that this is likely the beginning of the broader Wave 5 of 5 which can see a move beyond 126K over the coming months.
I agree Wave counts can be confusing and are only crystal clear after the fact, but that is not the point. The point is we can formulate potential scenarios that require confirmation by the market. If 80K breaks and price cannot swiftly retrace, then the bearish argument gains traction and price is likely in the Wave 2. IF 80K holds, and we are breaking back into the 90Ks, especially 95K resistance, then the bullish argument is in full swing.
Again this information is NOT to be used as a concrete forecast. The MARKET does what IT WANTS WHEN IT WANTS. We listen, adjust and manage risk. This information can be used as a general roadmap to anticipate further moves based on the confirmation the market offers. For example, if the bullish breakout scenario unfolds, it would make sense to expect more from longs. This includes things like: aggressive profit objectives (3:1 or greater), scaling into supports because they are more likely to hold, etc. Also expecting less from shorts, or not shorting at all, etc. Only you can decide how to adjust your strategy based on the context of the environment.
Also what makes this situation more compelling is the fact that the macro environment is strongly supportive. Lawmakers, the biggest banks and companies all innovating, investing, and betting huge in this space. On top of that, we have a government that is extremely Bitcoin friendly and setting us up for future rate cuts. CPI "officially" came in at 2.7%, less than expected which bolsters the argument for more rate cuts, perfect for the upcoming YESman, I meant Chairman of the Federal Reserve. Think about it. Remember, short term sentiment prices in the future based on only what it can process in the moment AND it is highly irrational. This is where short term mis pricing come from along with compelling lower risk opportunities you just have to have the confidence in your ability to recognize them.
Thank you for considering my analysis and perspective. Let's goooooooooooooooo!
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Try Trade Scanner Pro for FREE: bit.ly/TSCPRO
Watch Full Trade Scanner Pro Tutorial: youtu.be/fdFLhLnqM9A
Watch Full Trade Scanner Pro Tutorial: youtu.be/fdFLhLnqM9A
Related publications
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.