Why the Bloody Market?
Hey traders, I wanted to write a little market breakdown today as it seems the market is currently pulling back with pretty significant volume and pressure. I think it would be a good idea to just go over some of the possible main reasons why we could be pulling back and what is the worst and best outcome we should be looking for as we move forward...
Everyone who reads these articles is probably already aware that the market has been a pretty significant pullback, currently, Bitcoin is down around 15% and change and overall we need to determine what type of pullback this is what is happening at the moment. First I guess the ill start off by saying that this pullback was so predictable in the macro, the overall bitcoin price is up with great returns over the past 4 months, pretty much constant upside with no major pullback in that time. It's hard to believe that after 4 months of pretty much constant upside that people refuse to take profits and prepare for this type of pullback, but honestly I have seen it happen before and these types of moves can have a huge impact on the minds of traders. Scaling out of your position slowly in constant upside is pretty much the only way to be able to get out of the market at the closest possible top.
As you can see from the chart below, the overall upside momentum is still perfectly intact and this pullback is more than healthy, currently price only seems to be falling back to our first major level of support HTF and price seems to be holding well for this weekly close which is pretty decent considering the amount of selling pressure.
Honestly as long as we hold above $10,250 on the weekly close I think we could save a lot of momentum here, this is a major important level that would allow us to form a HL on higher timeframes. Failing to hold this level will pretty much guarantee that the next level we will be testing is mid to low $9000's, this is where price action could start looking a little dicey.
Overall for both BTC and ETH, this is probably a decent time to start slowly buying back in with hopeful profits that were scaled out from the top. I think scaling it with around 30% of stablecoins and leaving the rest just in case we do see a wick down is likely the best option right now. I personally like the fact that we are melting down so fast, this is a much better way to see a pullback compared to price just bleeding out slowly with no volume. In my personal opinion, this is probably market manipulation to clean out all the people who were over-leveraged over the past few weeks and months, so many people where overly bullish and these types of moves happy on purpose just to cause pain and liquidate positions.
I think we could see the CME gap at around $9600 filled on BTC and then we bounce back pretty strongly, seems as though people are already in a lot of pain with their positions, little bit more pressure and then I think we see some strong relief across the board, alts bouncing and momentum picking back up again. Just remember we have been in a bear market for the past nearly 3 years, this HTF trend is bullish, pullbacks are normal.