Down To Go Up
Whenever Bitcoin prints a series of red candles, I deploy this framework to gauge whether it is a run-of-the-mill correction, or a transition into a more serious bearish trend.
G’day Folks,
One of the most frustrating things about markets for new investors is the way they trade day to day is often highly counter-intuitive for the amateur investor.
More often than not, bullish markets have to go down before they can go up (and the same is true in bear markets).
On Thursday in Imagine Being Short, I presented a case where the market appears to be fairly constructive under the surface, but there could be some immediate term weakness to shake-out speculative leveraged longs.
I woke up on Monday morning Australia time to a Bitcoin price trading at $98.3k, which has technically broken to a new daily lower low.
For the technical analysts in the room, you will recognise this as a now confirmed daily downtrend, since the price has set a lower high & lower low combination.
This weakness in price action comes following some fairly dire news that the US has actively bombed Iran, which is quite a serious geopolitical development. Bitcoin tends to be a leading indicator for liquidity and how other markets are likely to behave in due course, and US equity futures have followed by opening in the red on Sunday evening US time.
In today’s post, we’re going to dive into this sell-off to see whether there are any major updates that need to be made to Thursday’s assessment.
It is critical to always adjust any market thesis as new information comes through, especially in the highly dynamic conditions we find ourselves in this year.
📈 Reminder: you can find the charts from our articles on the Checkonchain Charting Website, and a guide in our Charts Tutorial Video.
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