Bitcoin analysis 13/08/19
Diupdate
At these levels Bitcoin will have to act soon. It had a TD 9 on the 1h and right now the fractal looks extremely similar. However there are some difference between now and then:
The funding rate is positive and going up. Premiums are still quite high (both on USDT pairs and derivatives), while the L/S ratios are about 2:1-3:1. At the same time volatility keeps getting crushed and OI is really high, so eventually we should see fireworks. On a bullish trend low volatility at support is bullish, but if support is broken I expect the downward pressure to be immense.
Another difference is that even though the recent move up looked a lot like the 7.5k to 13.9k rally, it stopped on a doji, on a TD 9 on the daily and broke its MTF uptrend. During the previous rally the price hadn't really stopped for long other than after the break of 9k and hadn't broken its MTF uptrend. This doesn't mean we've turned bearish yet, as his time we went up more in both in dollar terms and percentage terms, plus we hadn't spend enough time re-accumulating.
For now the current bottom looks extremely similar to what the 9.1k bottom did, but then we had a TD 9 on the 3D and 1D. This time we have the HTF and MTF momentum with us, which obviously isn't as bullish as being oversold on a bullish retest yet it's better than nothing. At 9.1k-9.4k we were retesting May's highs and now we are retesting the levels we broke out from in August. That's pretty bullish considering how many times we touched that resistance and the bounce off it was pretty good (similar to the 9.1k bounce).
Today it should be the final day of the correction, as we've been consolidating for quite some time. Technically we are still bullish until we lose 10800. For me it all depends on how the market moves from here. Quantitative, sentiment and fundamental data are helpful, but nothing compares to pure TA. The VP looks really good and the re-accumulation looks mature and about to come to an end. Could the re-accumulation end with a massive shakeout to 8.5k and then up? For sure and that would actually be an incredible buying opportunity.
I keep mentioning that Bitcoin isn't correlated with any traditional stock markets, however Gold & Silver going up is definitely beneficial for Bitcoin as several traditional investors have started looking at it as some sort of digital gold. The problem is though that Gold is coming close to an important resistance zone and is up significantly already. Overall I still expect Bitcoin to be at 19k by end of September regardless of how we get there.
Finally in terms of altcoins, I don't think alts have bottomed yet in BTC terms, but they probably have some juice in them. I am not betting that they'll go higher, just acknowledging that they have so potential until Bitcoin's Dominance completes its correction. The higher alts go, the more they will fuel Bitcoin. Truly believe we are a few months away from a mad alt season which will either come by Bitcoin dropping very hard or by Bitcoin going up really hard.
The funding rate is positive and going up. Premiums are still quite high (both on USDT pairs and derivatives), while the L/S ratios are about 2:1-3:1. At the same time volatility keeps getting crushed and OI is really high, so eventually we should see fireworks. On a bullish trend low volatility at support is bullish, but if support is broken I expect the downward pressure to be immense.
Another difference is that even though the recent move up looked a lot like the 7.5k to 13.9k rally, it stopped on a doji, on a TD 9 on the daily and broke its MTF uptrend. During the previous rally the price hadn't really stopped for long other than after the break of 9k and hadn't broken its MTF uptrend. This doesn't mean we've turned bearish yet, as his time we went up more in both in dollar terms and percentage terms, plus we hadn't spend enough time re-accumulating.
For now the current bottom looks extremely similar to what the 9.1k bottom did, but then we had a TD 9 on the 3D and 1D. This time we have the HTF and MTF momentum with us, which obviously isn't as bullish as being oversold on a bullish retest yet it's better than nothing. At 9.1k-9.4k we were retesting May's highs and now we are retesting the levels we broke out from in August. That's pretty bullish considering how many times we touched that resistance and the bounce off it was pretty good (similar to the 9.1k bounce).
Today it should be the final day of the correction, as we've been consolidating for quite some time. Technically we are still bullish until we lose 10800. For me it all depends on how the market moves from here. Quantitative, sentiment and fundamental data are helpful, but nothing compares to pure TA. The VP looks really good and the re-accumulation looks mature and about to come to an end. Could the re-accumulation end with a massive shakeout to 8.5k and then up? For sure and that would actually be an incredible buying opportunity.
I keep mentioning that Bitcoin isn't correlated with any traditional stock markets, however Gold & Silver going up is definitely beneficial for Bitcoin as several traditional investors have started looking at it as some sort of digital gold. The problem is though that Gold is coming close to an important resistance zone and is up significantly already. Overall I still expect Bitcoin to be at 19k by end of September regardless of how we get there.
Finally in terms of altcoins, I don't think alts have bottomed yet in BTC terms, but they probably have some juice in them. I am not betting that they'll go higher, just acknowledging that they have so potential until Bitcoin's Dominance completes its correction. The higher alts go, the more they will fuel Bitcoin. Truly believe we are a few months away from a mad alt season which will either come by Bitcoin dropping very hard or by Bitcoin going up really hard.
Catatan
The reason I keep mentioning 10800, is that I believe we could see a big stop run to 10800-10950. With the long idea from Goldman Sachs we don't know whether they have already bought or not. By the looks of it, it is more likely that we are going down to shake everyone out before going up. However it would be also possible that they just have a pretty low target and they want people to sell early, so that they can pump it more and sell to them higher.
How would I play this?
1. You can either long here with a stop at 10690
2. Wait for a dip to 10900-11100 and long with a stop at 10690
3. Wait for the price to go above 11500 and long with a stop at 10690
4. Wait for a breakout above 12000 and long with no stops (lol)
I clearly wouldn't short right on resistance. I'd rather wait for a clean break... Option 4 is the one with the highest probabilities and less stress. Option 3 is also pretty good as it would follow the fractal step by step. Options 1 and 2 are ok with small size and risk no more than 1%.
Catatan
Based on these two, it seems like the altcoin correction is slowly coming to an end. People think that when BTC is going up alts go down and that when BTC goes down alts go up. But this isn't a fixed relationship... We've seen both go up together in the past and both go down in the past.Right now altcoins went up significantly in BTC terms, but only a small percentage actually went up in USD terms. Even those that did go up had previously dropped significantly both in USD and BTC terms.
As you can see since the July top, altcoins lost ground twice against Bitcoin, without Bitcoin even making new highs, so in my opinion this is a just relief rally in BTC terms... If it keeps pushing lower we could eventually see altcoins go down in BTC terms as well.
For now Alts are like Bitcoin hedge as they are holding most of their USD value, but also have some potential for appreciation. The issue though is that alts are more leveraged than Bitcoin in USD terms (higher Long/Short ratios), then this whole thing could turn very ugly for them if they drop below certain USD price levels. This could mean we might start seeing alts go down both in USD and BTC terms as Bitcoin drags them down with it.
The reality is that most large caps have another 10-20% potential for increase in BTC terms, so it might not be time yet. However once Bitcoin is done correcting, I don't expect an alt season, but the final leg of the altcoin capitulation. They will most likely start going up in USD terms following Bitcoin, but dropping substantially in BTC terms.
charts.cointrader.pro/snapshot/jWBCP
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