2/22/2018 The Market View and Trading Outlook
Getting closer to the lower end of the sweet spot I mentioned yesterday:
https://steemit.com/bitcoin/@pawsdog/2-21-2018-the-market-view-and-trading-outlook
We may go a bit below, but I am now beginning to see larger buy orders attempting to start a rally at key trend lines and possible reversal points. In saying “larger buy orders”, as someone whom has watched 1000’s of hours of BTC charts over the last few years, what you will see is 300, 500, or more BTC market orders jump in at critical moving average crossovers, support levels, Fib levels etc. in an attempt to jump start a reversal. Generally while price is in freefall (just coming off a high) these massive buy orders are absent as those with tens of millions to spend have sense enough to know that price is pulling back and will wait until they feel they can trap and opposing whale and get the most bang for their buck and have a truly influential affect on the trend. This also occurs while price is going up, these same mega whales will make attempts to trap opposing whales, topple the market at key points along the way so as to buy back in at a lower price post panic.
In the world of BTC price, there truly is a strategic battle between Mega Whale Bulls and Mega Whale Bears, the rest of us are just along for the ride. Bear Whales whom desire a lower price will allow large buy orders, then instantly drop a larger sell order on top of it, pushing price well below the entry point of the previous buyer, this forces the previous large buyer to cover sell and add momentum to the decline; which is exactly what the Bear Whale wanted to begin with.
Think of it like this, price is moving up, it is well extended from Moving Average support levels. At this point a greedy Bull Whale decides he wants to pump price with a 400 BTC order and suck in the retail investors behind him. So he makes his order into an order book that appears light towards the selling side so as price will jump up a few %. He buys, then instantly liquidates, ¼ or so of his position back into the retail investors buying behind him. At this point a Bear Whale will drop a 700 BTC sell order into the now very thin buying side of the order book, which pushes price below the initial entry point of the Bull Whale. Feeling a possible reversal rejection, the first buyer liquidates his remaining 300 BTC to the selling side, and boom his 300 stacks on the 700 and you have a 1000 BTC sell order pushing price down well below the initial pump by the Bull Whale, hitting stops, panicking retail buyers starting a greater trend reversal.
The same will happen when Bull Whales want price to go up. They will leave an empty order book allowing a large sell order only to counter with a huge buy order, forcing the previous seller to buy back in and add momentum to the upside. One thing to look for when watching the charts is large buy or sell orders that have little effect on price and are immediately countered by a larger counter offer. If you see a 500 BTC buy order at a possible top that does nill to price and then see a dump sell of equal or greater size, you are probably looking at a strategic reversal in the works. Same thing on the bottom, large sell order with little effect, then a huge buyer order immediately after.
Alright enough of the lecture, for those new to reading my analysis I tend to go off on a tangent at times.
Moving on to what we can expect from BTC today.
As I stated yesterday, much will be learned from how BTC interacts with the 4 hour 77 period moving average, how the 4 hour 77 converges with the 1 day 21 and MACD 12 hour 0 line. Price briefly touched the 4 hour 77 at $9818 and was met with a 400 BTC buy order in an attempt to fuel a rally, that has as of yet not materialized. While I feel this may be a decent bounce point, and that price will likely recover past this level at some point, I also feel that price is likely to go a bit lower first; closer to the $9500 or so I mentioned yesterday. My rationale is that we have yet to come back and retest support at the 6 hour 77 period moving average since breaking above it at $9176 on Feb 14th.
Price in the vast majority of scenarios ALWAYS, ALWAYS, ALWAYS comes back to test a major Moving Average for support after breaking above it. Currently the 6 hour 77 is around $9170 and will incrementally creep upwards so long as price stays above till a point that they meet. Give it another day or so and it should be around $9300-$9400 which will also be the 1 day 21 period moving average, possibly the 12 hour MACD 0 line and just enough below the 4 hour 77 so as to give us rebound momentum to the upside.
All that said I’m going to wait a bit more and see what occurs, if we head down around $9600 or below I may start to ladder in and incrementally purchase. If the trend stops here at the current price of $9850, I will wait until I have confirmation of reversal on the 2 hour and buy in there.
What do the charts say..
The 12 hour RSI has us entering oversold territory, and we are likely to remain here for a bit which is healthy. So for the next 24 to 48 hours I expect price to limp around in the mid to upper $9,000’s. In a healthy market, on a normal pullback you generally get 4-6 red bars on the MACD histogram, we are currently at 2, so we have some more downwards price action or sideways trending ahead of us. We are beginning to approach key reversal points as price continues is decline and resistance to the downside will grow incrementally stronger as price declines closer and to longer term moving averages. Price is currently basically sitting on the 12 hour 77, its first retest of it since breaking above it. Also of note, it is testing the 12 hour 77 at about the same time as the 21 MA is crossing above the 77 which is also a normally bullish and healthy sign of a pullback/consolidation. You often the 7 MA break above the 77, then price will fall back to the 77 thereafter to test support at about the same time as the 21 crosses above from below; normal, and a routine occurrence in all time frames. The 7 will then bounce the 77 as price moves higher after having fallen slightly below the 77 to drag down the 7. At which point price shoots toward a new high. So expect a good dip below the 12 hour 77, again towards $9500-$9600 to drag the 7 towards the 77 for a bounce upwards.
Price is approaching the 6 hour 77 period moving average and will likely hit it based upon the 7/21 downwards cross (yellow circle) which should provide the necessary momentum to hit the 77 and test it for support. RSI has us nice and oversold, we have been since $11,000 or 6 periods which is ample time for a minor upside reversal. What I expect to see is a bump up on a mediocre buying period followed by another sell, some sideways action and recovery. Guestimating would be afternoon or late evening tomorrow for some seriously positive action toward the upside.
Price is now resting on the 4 hour 77 and will likely dip below thanks to the 7/21 downwards cross on the 6 hour. RSI has us oversold, and we will have support at MACD 0. Objectively all things for the moment point to a reversal in the $9300-9500ish zone; accordingly I will wait it out a bit.
Lastly, everything from yesterday ( https://steemit.com/bitcoin/@pawsdog/2-21-2018-the-market-view-and-trading-outlook ) is still on the table in regards to the sweet spot for buying an inverse head and shoulders as well as a potential downwards channel. Of note, volume is beginning to look as though it would like to confirm the inverse head and shoulders; though we still need a bit more volume on the right shoulder for the pattern to be complete.
Also good to see haejin caught up today with my analysis and $9500 price points from yesterday
https://steemit.com/bitcoin/@haejin/bitc-btc-morning-update-tree-count-vs-forest-count… lol)
Also good to see him toot his own horn about the inverse head and shoulders yesterday stating he had been talking about it for a few days.
https://steemit.com/bitcoin/@haejin/urgent-bitcoin-btc-evening-update-critical-juncture-reached
Just a bit behind the power curve as I noted the beginning of this pattern forming 2 weeks ago:
https://steemit.com/bitcoin/@pawsdog/2-10-2018-the-market-view-and-trading-outlook
Well back to building a duck pond for me…
Lastly for Alt Lovers.... Check NBT (Nubits) in times of BTC correction, you may like what you see...
My Previous Analysis:
https://steemit.com/bitcoin/@pawsdog/2-21-2018-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/2-18-2018-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/2-13-2018-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/2-10-2018-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/2-7-2018-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/1-29-2018-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/1-27-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/1-26-2017-the-market-view-and-trading-outlook
Dude! Come back! We miss you!
I know it just sounds like words... but I honestly feel a little lost without you here... I dunno there's just something reassuring about the pawsdog. Hope the pond is going well!
Seriously! I need me some @pawsdog in my life, stat!
Where'd he go?
Come back!!
Duuuuuuuuuuuuuuuuuuuuuuuuuuuuuuude! We miss you!
Bro..... I got a message from u!
I offered me to do collaborate with each other!
Give me your whatsapp number?
I want to help you and I also want help on steemit!
This is my whatsapp num =+918341227201
Don't have whats app but you can message me on steem.chat
Thanks for the invite message about building a better steemit.
Where do I launch my neurons? :-D
We may need somekind of experimental front-end. (lets say Dreemit.com?)
Maybe also a non-social version where only the original posts can be viewed. Mainstream junkies who still can't think for themselves can't handle constructive feedback, so maybe a 'uncluttered view on steemit' may be more easy for them?
Stuff like that?
I would like to see somekind of googlesites alternative as well
Social media is ok but it also opens the door for pests to walk in. Sometimes you just want to publish something controversial for people to think about, but don't need the feedback when you already know what to expect.
And not everyone is hyper-social extrovert as 'expected' by steemit.
For introverts steemit can be a real overload. To me steemit is a left brain extrovert platform that doesn't take any right-brain introvert people into account AT ALL.
And that causes all kinds of issues. Like being forced into structure.
And that's one hell of an obstacle. It feels suffocating.
All the social stuff can be a lot of distraction.
:-) my apologies for being off topic, chaos is a force of nature.
No worries, I agree.. as an INTJ.. I totally see where you are coming from.. the googlesites alternative would be a nice addition.. so what's the idea behind dreemit?
@pawsdog i will start by saying thank you for this valuable piece of information on btc. I am one of those who have been closely monitoring the South-North movment of the price, and also it trending in the coin market and the reflective influence it has on the steem and steem dollar because of it pegs.
Yesterday, I noticed some slight change in the correlations on the BTC/SBD price which shows slight difference in the former price when it shot to 11k. But my intuition tell me that steem dollar is digging real deep and becoming more valuable by day (Anyways this is outside the subject matter for the day but i feel i should talk about it).
So the quote says it all.
Bottom Line;
There is light at the end of the tunnel
thank you so much.
i am me @brightfame
Thank you for the nice reply. We shall see what price does, the longer it stays up, the 6 hour will move up. No one can predict exactly when they will intersect only that they will.. We have come back to test the four again, and now back to test the 12 hour 77.. The six 77 has yet to be tested since it broke above. Ideally, all longer term trend lines would come to a point of agreement at which point the support would be nearly impossible to break. The problem with the correction was that we were so far extended from all averages we had no support. In a perfect world, price should hover just above averages, come down bump, hover above, bump, etc.. At least now, post correction we are beginning to ride much closer to most of the Major MA's.. Again a confluence of multiple 77's in multiple time frames around a single point, spells a solid bottom and something we can grow on. We shot up from 6k left the averages behind, come back now to meet them and hopefully begin to make measured moves upwards. Consider the MA's to have gravity that always wants to pull price back to them.. the farther away the price gets the stronger the pull to come back from either above or below, but if price can hover in a sweet spot just above.. then it is neutral happy and can make measured gains..
very nice thank for the infos you can check out my post related to pakistan keep supporting each other @pawsdog
I will check it...
I'm honored you invited me and I'll love to be part of this vision.
This is both educative and great, I feel we need this at this present time. Thank you
I agree... and thank you for stopping by
Fantastically thorough analysis. So many other Bitcoin and altcoin posts refer to some brief chart TA and usually end up giving newbies false dreams of overnight "lambos" and stupid shit like that, without realizing that most of that TA could be on a very long time scale, requiring patience that many don't have. Anyhow, thanks for this post. Great information!
No overnight lambo, WTF... lol.. I tend to over explain in my TA.. but I have been doing it for a while.. I do it almost as much for myself as I do it for the blog. Writing out my thoughts as such cements in my own trading plan...
let's visit my blog
I will check it out
Great lecture ! Always great to hear about the experiences of an experienced trader, great insights ! The battle between whales is fascianting and just watching the tape makes me feel funky :)
As for BTC, I don't see a reason why it should go up from here (as I wrote in my latest article) I see it more likely to continue its journey to the 200-day. However I am aware that it is very difficult to predict BTC's movement in this environment ,so I would like to say taht I haven't backed my opinion with a short position. I am currently sitting on cash !
Thanks for sharing your experience ! Always great to read your analysis :)
Thats why I am in cash at the moment, waiting for confirmation.. It will do what it will do, but I feel pretty solid about the 6 hour 77 and the 1 day 21 (for the moment).. I like to buy into the uptrend, so I'll just wait for the moment and see what happens.. to easy to lose money at the moment. As I stated, both options are still on the table, a large shitty descending channel as well as an inverted head and shoulders.. Time will tell...
As always :) How are things with you, hope everything is great !
Things are good almost got my duck pond finished...:)
great ! Send us a pic or something whyen its ready :)
Thanks for your invitation @pawsdog.
Very realistic point of view, and very good analysis. I think it's a matter of time and patience and BTC will be go up, now is calm time
Very good post and work! thanks