Whats going on traders, today I am analyzing BTC/USD on the 1D chart.
After price reached the 10,000 level, investors are now thinking with logic and not hype and enthusiasm. Reaching this level was the pique of many Bitcoin analysis that I have seen all over TradingView and my Bloomberg Terminal. I believe now the level was hit, a correction is due.
Price recently showed 2 huge doji's, showing major indecision. I believe this is the bulls running out of steam and bears starting to nudge the market into submission.
I am expecting price to correct. On the chart, I have outlined a few possible places for BTC/USD to correct to on the chart.
The correction measurements are:
Correction move to 8100-7500. Then price will regulate and continue its intended trend.
Correction move to 5530. I believe this will be the maximum correction the pair will have.
Bare in mind that however strong an instrument is, however compelling it is, however amazing it is performing, it will ALWAYS CORRECT. A correction is not a sign of a change of ideology, it is simply a sign of trading.
Always remember, trade your CHART and not your MIND. If you do this you will be a successful trader always.
In my related ideas, I have posted my previous BTC/USD analysis. If you review both of these analysis together you will see how I have come to this analysis.
I will be updating this analysis as the trade progresses. Leave a like & follow to keep up to date with my analysis.
it s good that it corrects and the lower it goes the better it is for planet earth so more and always more people can join the family - power to the people at last , and to all people because if the regualar price of 1 bitcoin spins out of proportion it will not be the peoples' currency but of the elites only
TomProTrader
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@scousertommy, Agreed. The concept of a "peoples economy" is definitely possible with CryptoCurrency. It is a shame that Cryptocurrency will never be a totally organic economy because eventually there will be a ceiling as to how many Bitcoins will be produced, which won't allow it to breathe properly.
It's anyone's guess what will happen with Bitcoin when that time comes, I don't think anyone really honestly knows.
Thanks for sharing.
scousertommy
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@TomProTrader, thanks for your answer tom , just wanted to ask you if you think that btc's temporary bearish run will get bitcoin cash on a bullrun please ? also i wanted to ask you if i may what effect do you think this short correction from bitcoin will have on the alts market , do you think that they might also go on a bullish channel , sometimes when i am analyzing i notice for example the same exact movements up and down on the 2 hour candle chart on trading view of a few coins like bcc btc btg bcc and even strat btc was now doing the same exact movements up and down , i could not look at more at the same time , but i have the feeling that there is something which is moving them together at the same time , did you ever notice anything similar please ? thank you so much.
TomProTrader
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@scousertommy, If BTC/USD continues to the upside, then it will be very short lived. Despite how well any instrument is performing, however massive, or whatever the increase of price is; it will ALWAYS correct in the opposite direction before any further continuation move. If price does not correct, the trend is UNHEALTHY. Don't mistake a strong up or down trend as health, it is NOT. It means the trend is greedy and sick, and needs to recover to health again.
To answer your question, if BTC/USD continues to upside then it will not last long at all. It will be short lived and just make the inevitable correction even bigger than it already will be. Now, the steeper and bigger the up move will be, the harder it will be crashing back down. So, therefore:
-If price extends itself further to upside (Without correction) then it will crash hard, and therefore effect Bitcoin Cash considerably. (An overextended trend especially with massive doji's shows massive volatility. This is perfect for effecting Bitcoin cash.
-If price corrects now, it WILL effect Bitcoin cash inevitably. HOWEVER, the correction is predictable, which means technical analysis traders can easily take advantage of the trend, and therefore price will be predictable in movement, and will effect the Bitcoin much less than the above scenario.
Me personally, profited over 2,500$ per Bitcoin within just a week (If you followed my TradingView idea last week you could have also caught this move).
Some other traders and fund managers may have made similar too. They want out. They want to secure their profits. Only greed will overextend the trade (Which is better for making Bitcoin cash move). So it's greed versus euphoria. Recipe for a huge move.
So in conclusion:
BTC/USD corrects now: Bitcoin cash will be effected somewhat (Probably not massively) as the volatility will be huge and technical traders can take advantage of technical trend.
BTC/USD extends more and corrects later: This will make BTC/USD crash but will also make Bitcoin move hugely too.
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Now in regards to correlations of different coins:
Coins usually follow each other in trend because frankly- there is absolutely nothing else for traders to compare the coins too!. So basically, the reason for them trending together is nothing more than: "Bitcoin has managed to do 10,000 so this means all other coins should follow the same logic and if Bitcoin crashes, everything else will crash and burn with it too"
It's this sort of "cattle and herd" psychology that makes prices move so much in the first place.
scousertommy
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@TomProTrader, hi tom thanks again no i have never followed you i just bumped into you through that idea of yours you posted over here so by coincidence , i will definitely start following you.
since alts go against the bitcoin , example decred btc , when bitcoin goes down crashing shouldn't the alts move in an opposite direction , btc down alts up ? or is not the case at all , as from what i think i have understood in your answer you just said the opposite happens , when btc crashes the alts go down and when btc goes up the alts follow
i am still unsure how that works out
scousertommy
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@scousertommy, even for example i noticed just recently since btc was correcting a bit that emc 2 and a few more coins were still moving up , and that is not something that i can still comprehend , why that happens ? is it because some coins like emc 2 and dash i mean the main projects are literally become independant from any other coin's movement even from bitcoin a bit ? could that be the case ?
TomProTrader
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@scousertommy, It could be indeed the case. But honestly, I do not know enough about each individual Crypto to answer this question with accuracy.
I believe whilst all coins do not trend PRECISELY, it would certainly be an exaggeration to say they are negatively trending. I feel they follow a relatively close trend cycle (But hey, this is just my opinion on the matter, others may differ.).. I don't think other coins go against Bitcoin much.
Back to my above statement, I believe that coins do this because of the "how do we compare this?" scenario.
(Again my analysis of correlations of coins is entirely my opinion.)
SammyNoden
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@scousertommy, When bitcoin makes strong moves up or down, altcoinBTC pairs tend fall because either their value relative to bitcoin falls due to selloffs to catch the BTC trend, or traders take profit from all their coins and move out of the market. AltoinBTC pairs tend to do best when BTC is range trading / consolidating. These are just tendencies though.