Good morning ladies and gentlemen and welcome back to my daily analysis of Bitcoin. Today I have the daily time frame pulled up after a pretty boring weekend. At least for Bitcoin. A few alts seemed to be dumping pretty hard causing a noob question rush of "Should I sell?" If you have to ask a bunch of strangers if its time to sell you probably should not have bought in the first place. This weekend was big in terms of closes. Daily and weekly and monthly all closed at the same time. And while that in itself is not a bullish or bearish event I still take notice and watch the candles when that close is coming. Anyways lets take a look at the charts and I will explain further.
The close yesterday was important as I just mentioned it was the daily the weekly and the monthly close all at the same time. With that in mind a trader should understand that a candle can remain largely dormant for the majority of its existence til the last bit of life. I remember watching the 4hr candles closing a few years ago. I would simply tune in to the last few minutes of the candles lives and they were violently jumping all over the place. The bears and bulls literally putting up their dukes and fighting for the best close they can get in their favor. You can see it yourself if you look at the close of many candles. Especially during peak volatility times. Just tune in during the last ten mins and you may be surprised.
The reason I bring this up is the close can change everything. You may be in profit for 3 hours and 55 minutes but in that last 5 minutes the bears can make their move reducing your profit to dust. That is why I was watching the close yesterday evening. Looks like after the close we had a bullish start to the week. I was looking for a gap but I could not find one. There may be a small one slightly higher than the candles but I cant say for sure as I am really still learning the gap system. I can profit from it quite well but that doesn't necessarily mean I understand it fully.
Regardless I decided to plant a long this a.m. with a stop loss set just below 42k when I entered. I will likely walk my stop loss up as the candles stack up. (If they stack up I should say) The real test right this second is if we can retake the lost support of the 4hr 50 MA which I drew a really rough representation of onto the daily time frame. This way you can see the daily 50 MA which is important along with the 4hr 50 MA which in my opinion is also important. Currently the first resistance going up I see is that 4hr 50 MA. It will be a daunting task to rally the troops to take us back above the lost support. The reason I mention that is the fact that the 4hr cloud is directly above the 4hr 50 MA and with that in mind it may be too much resistance for the bulls to take on. Time will tell and if we beat 52k we are in the clear! Although that will be easier said than done! I hope the bulls can prove me wrong though. This is one time I hope Im wrong lol.
So here we sit. Its Monday morning and we are still below 50k. Many noobs have been messaging me asking if this is the end. Relax is my response. If you are sweating a 15% loss you better sell and hang up your investment boots for good. Investments should not make you lose sleep at night. They are designed to enhance your life. I understand holding for bigger gains and that is understandable. Delayed gratification is always nice. But if you are not holding long term you need a strategy. I like to try and double my investment. So I put in 100 dollars. When it gets to 200 through trading I remove the principle and let the 100 ride. If I lose the 100 in profit at least I didnt lose my principle and that is just the way I trade. Everyone is different. I hardly ever sell, as I just walk that stop up til it finally does trip. I know it may seem like I miss the top by doing this and that is accurate. Im not worried about selling at the top. I may miss out on 5% (more often than not its closer to 3%) but the piece of mind I get is better than that small amount of profit I lost. That chunk of profit I got between 3800 and 55k was the big deal. Not the fact I missed out on that last 3k. BFD!
Sometimes I like to give some helpful hints in these analysis and this morning was no different. I hope the info I shared was helpful. I am looking forward to this week. Hopefully we can retake the 4hr 50 MA and sort of restart the bullish bonfire from December to February we enjoyed. Im not holding my breath though. I am making sure my stop loss is where I think it should be though. That rectangle support I drew on the chart really shows a strong area of support right between 42k and 45k. If we can stay above this and the daily 50 MA I remain largely bullish. But dont count the bears out just yet. We need to be on our toes traders and that is why they made a stop loss after all... If you plan to long this set a stop loss! Dont get cocky. Risk management in my opinion is part of trading and if you dont take advantage of a stop loss its like trying to build a home without a hammer. Sure you can hammer the nails in with a wrench or something but a hammer sure makes it easier. Same with a stop loss. I hope we all have a bullish Monday! Make good choices folks and always remember WTFDIK?????
TLDR: Bulllish candle to start Monday off. Lets keep it up bulls. 42k is the line in the sand. If we lose that Im bearish, Mainly because we will lose the daily 50 MA in the process.
Here is a link to my YouTube Channel. It has a preview of the trading course I provide and I plan to grow it a lot this year. Here is the link https://www.youtube.com/
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