Bitcoin whales playing with retail, expect the unexpected.

29 Jul 2019

For this analysis we will be looking at the chart of XBT/USD on Bitmex
This pair has been purposely chosen as this is the trading pair with the most leverage long/short positions. This makes it easier to spot where/when liquidity is being taken.

Pretty much the whole crypto space is waiting on the retracement to rebuy BTC.
Currently I am seeing alot of the same analysis all aiming for same zone to (re)buy BTC, mostly between 8 and 8.6k.
What does usually happen when everyone thinks alike? well usually not what the majority thinks.

Whales have been very active in the past 2 weeks while we have been consolidating in a range, trapping retailers in every single way possible.
Stop losses are usually placed just above lows/highs and these often are victim to stop hunts as they are an easy prey for the whales.
The red lines show a stop hunt occuring, thus taking liquidity out of the market.

So where can we currently find liquidity in the market in the form of stops?
If we take a look at the upside of our chart, we can see that most of the highs have been raided, meaning not much liquidity resides to the upside.
if we take a look below our current price we can see the low on the 17th of july has not been violated yet.
Furthermore, we saw a drop yesterday which did not violate these lows. The price reacted strongly creating upwards momentum, this means longs were being opened at these prices and shorts were being closed.
With more longs opening, the stop losses of these longs are most likely placed somewhere below our current low and the low of the 17th of july
This means that there will be alot of liquidty below these 'equal lows'.

So how do we trade this?
What we would like to see is the following:
- Price pushed below thse low of the 17th of the july (9080 on Bitmex XBT/USD)
- Price is being bought up after the low has been violated
- Buy when prices closes above 9080

What we don't want to see is:
- Price closing below 9080
- No strong buying after price drops below 9080


So, why did I mention that most people are looking at the same area to rebuy?
well, if this trade plan works out, it means that the 8-8.6k most likely won't be reached and still we remain bullish.
This means the majority of the people will be waiting for that 8-8.6k zone just to fomo in later as the price will not have reached it.

Conclusion
- Easy liquidity below 9080 (XBT/USD Bitmex)
- High chance of trend being frontran
- Market usually does NOT follow what the majority thinks

31 Jul 2019

Trade aktif

Expecting resistance in this green zone