Bitcoin: Lower High OR Higher Low?

26 Jun 2021

Lower high established off of 35,500 which points to a potential lower low (26K?) BUT 30K has YET to break decisively. Instead of REACTING to old information, we anticipate scenarios and then WAIT for the market to prove one. In this case, it would be a higher low off of the 30K area and new swing trade buy signal.

I don't marry opinions and instead stay flexible. I recognize that the recent broader structure still favors bearish follow through, but at the same time, I do not lose sight of the fact that 30K is a large magnitude HIGHER LOW relative to the bigger picture. The original break of 30K followed by a swift bullish reversal (pin bar) proves that there is buying activity around the 30K AREA. Those who are calling for a bear market are TOO EARLY and face a high degree of risk on the short side.

The BULLISH scenario: IF a higher low develops around the 30 to 31K area AND the high of the current candle (once closed) is taken out, that would qualify as a new long signal. Risk can be defined from 28.5K while reward potential is still around high 30's or low 40's. IF 35.5K is taken out in the next leg higher, that would signal a change in structure to more bullish.

The BEARISH scenario: IF price closes and then takes out the current candle low or previous low, the 28.5K low is likely to be cleared and a move to the 26K support is still within reason. While this would be a lower low in terms of recent structure, it can serve as the next important inflection point and establish a Wave 4 bottom. This situation is most appropriate for day trade strategies if you are considering the short side which limits the degree of the large magnitude risk. If you are new you should not day trade.

All the information that you need to make actionable decisions is on your chart and contained within price action itself. It is not only about what you can see, but also what you can't see or what price is NOT doing. If you are confused, it is because you most likely consume the same information as everyone else and have no clearly defined set of rules to filter price information with. More importantly, you need to recognize that the biggest obstacle in this game has nothing to do with interpreting charts, and everything to do with acknowledging the psychological incompatibility set forth by our own human nature.

Thank you for considering my analysis and perspective. I hope you find it helpful.