Tag: Week

Table of Contents

Overview of BTC (Mid-term, long-term, short-term technical analysis + short-term trading practice example)

Overview of BTC

This week the market ranged towards a heavy upside. We believe the ranging market is likely to continue next week.

Medium / Long Term

↓ BTCUSD weekly candlestick chart

Last week there was a confirmation of the weekly positive trend, but since the fixed position of the weekly bar last week was the resistance zone of the horizon (white box in the figure), it is likely to be confirmed by a small candlestick this week (ranging market price when viewed on a lower timeframe).

 

We will continue to assume the monthly bar is in a positive trend, and even if it falls in the short term in the future, we are thinking of building a short-term long position against the opening price of the monthly chart (as it seems buying will be made with the opening price of the monthly chart in mind).

 

↓ BTCUSD daily candlestick chart

It is almost identical as the content of last week’s article, but there are two points that can be seen by looking at the daily chart.

 

1. The current price range is at the resistance zone of the daily level resistance.

Therefore, the profits of long positions and of new short positions from the bottom are considered likely to enter the price range in this area, likely resulting in a conflict (range market) in this price range.

Although it seems to move out of this resistance band in the short term this week, there may be a wick at the daily level where the upper price is likely to have strong resistance.

 

2. We must not forget it may be necessary to insert a time adjustment (horizontal axis adjustment) for the trend to flip (reposted).

 

Short Term

The cryptocurrency market is strongly correlated to the US index even in the short term. Again, there are many volatile movements correlating with US100 (Nasdaq Composite Index), so tread carefully when trading if you are not used to it. Especially at 23:30 JST when the US market opens, volatility tends to be high. However, it seems the price may hold at the horizon or zone where it should stop.

 

I also felt this week there was relatively small correlation in the short term compared to last week. I want to trade keeping in mind the environment changes constantly. Once the US index establishes a direction, it will trend in that direction for a while on that day. Positions that go against that trend should be avoided.

 

Short Term Trading Practice Example

Here are some practical examples of short-term trading this week (this example is of a short-term trader).

This chart is a comparison chart of BTC (top) and Nasdaq Composite Index (bottom) near the opening time of the US stock market on February 10. As mentioned above, it is obvious the movement is correlated, and it is important to pay attention to the magnitude of the volatility. It has fluctuated by more than 5% in a short period of time.

 

For reference, how it was traded:

At 23:15, the zone of the white box in the candlestick above was confirmed with the lower wick, and then after 16 minutes, it seems the long position was built from this zone from the lower wick on the back side.

Since this is my first written article ever, I will write it as encompassing the entire year. This article is not investment/financial advice, but is written as a reference for understanding the current market. Not financial advice.

Table of contents
BTC Overview (mid-term, long-term, short-term technical analysis)
Altcoin Strategy

BTC Overview
Many assets (such as the US stock index) that has been rising due to the benefits of monetary easing have generally turned to a downtrend, anticipating the reduction (tapering) of monetary easing. BTC is no exception and is in a downtrend.
The charts below are a credit to Coinbase.

Mid-term / Long-term

BTCUSD Weekly candlestick chart

Looking at the weekly chart, the rate of decline in April 2021 is about the same as the amount of decline this time around. In other words, it has once shown a rebound in the price range that is conscious of the previous price range.

BTCUSD Daily candlestick chart

Two points can be understood by looking at the daily chart.

1. Even if you dig down into the current price range, ~$30,000 is a strong support zone (a zone where it has rebounded even if you look at low prices many times in the past), and it seems buying is active. This is a little short-term timeline, but if it falls, there is the option to go long to around $30,000. It seems there will be a rebound at least.
2. It is necessary to intervene time adjustment (horizontal axis adjustment) to flip the trend. Look at zone A on the chart. This is the part where the last medium-term adjustment was made.Looking at the horizontal axis, it can be seen that it took about 3 months from May to July 2021 to reverse. This may take some time to reverse from a down to an uptrend, so even if it reverses here, there is not much need to rush in and buy.

Short-term

Correlation between BTC and Nasdaq Composite Index (US100) / Dow Jones Industrial Average (US30)

Even in the short-term, it is often correlated to US indices. There is a lot of movement correlating with US100 (Nasdaq Composite Index), so be careful when trading if you are not used to it. Especially at 23:30 when the US market opens, volatility tends to be high and violent. The impression is it will stop at the horizon or zone where it should.

Also, even if in a downtrend, if BTC was not sold from the from the local top, be careful about a rush to sell.
After making a big move, it is normal to set up a box range and adjust the horizontal axis, so you should be aware of how to hold a position to buy at the lower limit of the range and sell at the upper limit of the range.
Currently, for example, I want to set up a short-term position with the white box in the figure below for my backing:

Resistance support zone that is likely to be noticed in the latest short-term trade

BTCUSD resistance line on the 4Hr level

Altcoin Strategy
Many altcoins have fallen by more than 90% from their ATH.
(ref. https://dropstab.com/price-history)
Also, since the market as a whole is in a clear downtrend, we would like to avoid holding for a long time axis for altcoins. (I will write this repeatedly because I want to keep it in mind until BTC turns bullish.)
If you want to buy on a long-term time axis, you need to make a solid plan and in some cases cut off your losses in a moderate basis.