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The Banking Crisis and the Bank of America CorporationIntroduction The Bank of America Corporation is one of the most famous of Warren Buffets holdings. It is right behind Berkshire’s Apple holdings in size and it has only grown during the recent banking turmoil. This is while he is “dumping” other banks because of red flags in their financials. That is beginning to look like a bad decision based on the technical of BAC. Source: markets.businessinsider.com The United States and the world appears to be facing a very serious financial crisis and we are in the stages where equities are still slow moving. The real impulse will begin when a lower timeframe rally is shorted and the news gets apocalyptic. BAC is ultimately on the chopping block. Analysis This is a pared down version of my momentum charts where I try to get the most out of a trend by riding the impulse. As such I don’t have a trade on because price has not slipped the 200 yet. If you want a full breakdown it is in the linked idea on Matic and Solana. Now, due to how fast bank failures can happen I might miss this trade being to patient. The MACD and Signal are below zero on the mothy. That is bad in itself. Price has slipped the 50 month, that is also bad in itself. Both of these things have occurred as BAC is dropped out of a falling wedge. Also very bad. BAC has also set a lower high from the high before the 2008 financial crisis. That is catastrophically bad because it sets BAC either a W bottom or an ABC correction. The W is shown on the main chart and the ABC correction is shown below. The wider view A banking crisis is the apparent reason bitcoin was created in the first place. It also lead to a pump in silver and gold once there was a “paper” decline in price. I remember reading the news stories from the 08 crash were people were selling their precious metals for wide margins on eBay and other platforms while the exchanges were selling silver derivatives for cheaper and cheaper.. As such, another banking system crisis should see the anti-fiats begin to pump once the thrash has happened. I would expect a massive risk off situation but somehow bitcoin and other cryptos look bullish. If is a very schizophrenic time to being doing TA. It is also a crazy time to trade. I don’t know if I will be engaging in capital destruction because of bad trade or just because my exchange collapses. Most likely I will buy the dip in paper silver and ride the gains up. Dark times with a silver lining.
NYSE:BACShort
by This_Guhy
Nasdaq Bull Trap StudyIntroduction I lost a lot of money when I began trading in 2018, and truth be told I have not made it all back yet. For years I blew up accounts not being able to recognize bull traps and properly set my stop losses (or take profits) and I engaged in a lot of capital destruction. As such I have spent a lot of time trying to make sure I don’t destroy more of my capital in trading another bull trap. The real question for myself is “Have I become vigilant (seeing what is there), or hyper-vigilant (seeing what is not there). Analysis This is a simple application of support and resistance. What was support flips and becomes resistance. But, because we suspect there may be a bull trap we are looking for a potential fake out. So the resistance may look like it is going to fail. In this case the star indicator is the gaussian channel. We are looking for it to act as support and then flip to resistance. But as the gaussian channel flips to resistance it might look like it will fail and the bullish trend will continue. That is what we see on our main chart. Price has popped out of a red gaussian channel and so some people may be bullish and expect continued upside. They may be doing fib extensions to the upside as part of their targeting. For this idea, the Keltner channels is along for the ride. Price pushed the Keltner channel up for the impulse and now I expect to see the top of the kelter acting as resistance on the way down. Due to the speed of the moves we can see the same thing happening in the 2017-2018 topping formation for bitcoin on Ethereum, but this time on the daily charts. Eth Example Two bull traps The main chart is on the weekly timeframe but we are looking at Eth and Bitcoin on the daily. With this set up the Gaussian channel was able to turn green again, once again selling the bull trap. The indicator was green and for the past several years that was suggesting continuation to the upside. But price broke down and the channels acted as resistance until ETH met a major target at the 1.618 extension. Bitcoin Example of Two bull traps In the case of Bitcoin with the first bull trap we set up a longer-term consolidation pattern that had people calling for saucer reversals, cup and handles, etc. Signs of green we seen as potential for more upside while more experienced traders were calling for more downside. Topping in select Equities Amazon Tesla Microsoft Lulu Meta (might actually have some more upside potential Final Thoughts & what I am doing The equities markets move relatively slow compared to crypto and if bitcoin was able to create a long consolidation structure (ascending triangle) it is not beyond reason to think that the NASDAQ or other indexes cannot either. Bear market rallies are often hard to predict and lead to lots of shorter/options traders loosing money because they did not close their shorts in the money. I am biased short in the short term. I have one long that I think will be profitable but when that has reached a target I am only shorting. I don’t want to deal with the complexities of having both longs and shorts. It can really hurt your head. My main trade is merely holding my MATIC short until it hits the monthly SAR. Somehow Bitcoin, despite all of the negativity, looks to be in the early stages of a bull market. Maybe we will see bitcoin steal some money away from the Nasdaq rather than having both plunge.
TVC:NDQShort
by This_Guhy
78
Etherum's different potential W pattern outcomesIntroduction Ethereum's price action has been concerning for some time now.  Generally speaking the more something goes up the more of a cooling off period it needs and Ethereum has been over-performing a lot of the older crypto currencies for a while now.  At the same time it has shown quite a bit of resilience compared to the Other coins and how their W patterns have played out. W pattern Analysis The top chart shows Ethereum, Monero, bitcoin and bitcoin all with a double bottom or W.  We are being a bit loose with the terminology because strictly speaking in traditional markets a double top or a double bottom is suppose to have at most a 5% difference in the lows for a double bottom and 5% difference in the tops for a double top. Ethereum and bitcoin both set higher highs with their W patterns but the structure of their Ws was different.  We can see a clear amount of white space on the Ethereum chart between the green and blue zones and that space is not present in the bitcoin chart.  Bitcoin had a much tighter consolidation pattern than all the other tokens. Monero and Litecoin basically double topped in 2021 and have been consolidating ever since. They both returned to the green zone and found support there.  Monero found continued support there while Litecoin bounces and is now being potentially rejected by the green zone.  That is quite a bearish set of circumstances and Litecoin is one of the least attractive looking OG coins at the moment based on that weakness. My bais and conclusion My bias towards Ethereum is that it will return to the green zone.  That is about a 80% drop from here.  The chart below shows that the situation with the gaussian channel and keltern channel seems to be quite similar to the middle of the last bear market.  the situation pairs well with the Log MACD situation. For me, the main question is how much of this potential drawdown of the Ethereum ecosystem will drag down the broader crypto market.  I suspect we will see lots of risk off and draw down in other crypto which will then pump due to people rotating out of the Ethereum ecosystem. while it trend sideways. There will be some pumps here and there while people take profits in eth pairings. For example, I see ETHBTC in a head and shoulders and I suspect that at each fib level people will be taking profit on ethbtc shorts and we will see bounces in ethusd when that happens. 30-40 percent bear market rallys happen all the time. I don't see the ETH ecosystem being a target of investment until it reaches the ethbtc target and then we will see strong hand come back in.
COINBASE:ETHUSDShort
by This_Guhy
18
Optimism poised for a 75% draw downTLDR: Lots of well established TA suggests OP takes out the previous lows at 0.41. Analysis I am going to begin with the divergence primer just in case a reader is unfamilar with the divergences and what they mean. Divergence Primer Classic Divergence (Trend Reversal) Bearish: Higher highs on price action but lower highs on the indicator Bullish: Lower lows on price action but higher lows on the indicator Hidden (Trend Continuation) Bearish: Lower high on the price action and higher highs on the indicator Bullish: Higher low on the price action and a lower low on the indicator As the chart shews both OPUSD and OPBTC both have great deal of hidden bearish divergence on the Log MACD (and histogram) as well as the RSI and Stochastic RSI. The Gaussian channel is pretty powerful as support and resistance and generally speaking I get excited to buy beneath a red Gaussian channel or when I see price action powering its way through. Not so much with OP right now, with the hidden bearish divergences. I expect the top of the channel will continue as resistance. Likewise the 100 Daily Moving Average is right above price action and I assume it will continue to act as resistance as well. The volume situation doesn't look good to me either. With price breaking out above the Value Area of the VPVR to create all time highs and coming back in on both OPUSD and OPBTC I think we are going to see more typical behavior and the value area will act as resistance, especially on OPBTC. The On Balance Volume has set virtually equal highs with this current peak and the peak from September. That is a sign of bullish exhaustion. It is also concerning that both the 10 and 20 SMA are below the 100. If the OBV regresses to the mean (the 10 or the 20) then that dip would get me deep into the money. Not all the way to target, but deep enough I can have a fairly profitable stop loss. Here is a similar move on Matic over two years ago where Matic dupped and took out what looked like strong support at the 0 line before rallying up to just above the 0.618 retracement before crashing. From there it went 400x If OP has a similar run then I will be quite pleased. Also, if OP crashes down to about the 0.28c I will go in full accumulation mode and hopefully we will see it run in another year or so. Macro I still think a lot of the equities indices are mostly done with their downside. I also like a lot of the "OG" crypto currency coins like XMR, Dash, XPR, BCH and I think a lot of the nu-crypto coins that were the top runners of 2021 are going to crash at bit more before going into long consolidation. That is a lot of moving parts for me to hopefully get right.
Short
by This_Guhy
1
UPDATE 1: Battle planning on Solana looking at EthereumTLDR: I waited over 4 months for the trade to get to the point I would put a short on. The next move is to short to the buybox. See the linked idea for more context Introduction I have spent a lot of time looking at blow off tops and parabolic moves over the last 450 ideas and 5 years with the goal of being able to benefit from these natual phenomenon of mass psychology. One thing I greatly desire for my trades now is what I call "chart clarity" where the better a asset looks to be following a pattern I know the more I want to trade it. I plan on following this fractal for the next couple of year so long as each step gets confirmed. I hope to make a lot of money doing this and hopefully others can benefit. Analysis and battle plan ETH was prety volatile during the last bull run and bear market but once we zoom back it was just a simple ABC correction with a final consolidation at the Fib Extension 1 level before a final quick move to target. In that case the C wave was a 1.618 extension of the A wave. As I chart it, Solana's C wave will be a 2x extension of the A wave. Ethereum had a symmetrical triangle that it broke out of when it was done consolidating at the 1 line but Solana has an even more bearish continuation pattern, a bearish rising wedge on a flag pole. Price action can be inconsistent depending on the exchanges being looked at but the target is the blue buy box. If price wicks below that into the area of the muave-ish circle then that would be too low for me and would make me think the pattern could be off going forward. The chart below shows some smaller time frame structure. There is a head and shoulders formation that should facilitate price breaking down out of the wedge in dramatic fashion. A look at SolBTC shows a black head and shoulders making up the top of a right shoulder in blue heand and shoulders. That SOLBTC sell pressure should create a lot of sell pressure on SOLUSDT. Further battle planning If price consolidates in the buy box as predicted the next big move I would want to play would be a long with price action going up to the base of the bull trap, which is the end of corrective wave A and the beginning of wave V. As I study this fractal on smaller altcoins I have seen some rallies move quite a way into wave B but others have died within pennies of the beginning of Wave B. I shan't be greedy.
FTX:SOLUSDShort
by This_Guhy
4
Bitcoin and a simple NVT StrategyFundamentals Despite some confusion bitcoin is both a decentralized payment system and the name of the currency of the network. In contrast, SWIFT is a centralized payment system that has the dollar as its currency. Bitcoin's greatest value is when the currency is undervalued to the value of transactions it is running. That is when the system is the cheapest to use. It is the most expensive to use when the NTV is high. People with a lot of executive function will plan their purchases of things when they are cheap and sell them when they are expensive. We all wany to do it, some of us are better or worse at it. Technical Analysis This marvelous NVTwas created by aamonkey and it helps show when the price of bitcoin about fair value (yellow) or when it is overvalued (red abd above) and undervalued (Green). It is of course sensitive to time frame and I have used it to call for rallies from time to time with warnings that they could just be setting up local highs before going for local lows. The main chart points out the series of operations well enough that I don' think I should replicate it here. I have some other posts where I was watching some triangle or channel formations and if they held that would have signaled a lot more upside. But all that is trumped by the NVT going green on the weekly. History has shown the pattern that when the NVT goes into the green on the weekly it is a vicious bear market. As much as I want gains to the upside the formations broke down. The chart below shows the triangle I was previously biased bullish on. No doubt it broke down. Price can impulse from here to the downside or it can rally and get back into the triangle or get rejected by previous support. The NVT suggest a bias to the bearish scenarios. My Positioning I have in large part left BTC alone because it was range bound and I have not seen an overriding signal to the upside or downside. I have mentioned in several post that I see several triangle formations that could be played very technically but I don't like to play triangles as they are the formations taht are the easiest to recognize but the worst at performance unless they are in a wider structure. Having seen the NVT finally turn green on the weekly time frame leads me to conclude that the bear market is fundamentally in. Even though the network is undervalued by a key metric history has shown that the price will experiences significant more downside and it is during the bear market that accumulators will eventually step in... way lower than most expect If you want to use the bitcoin network as it is intended, as a decentralized payment processer, then this is the time to do it. If you are looking for bullish continuation now is not the time. I am looking to trade things that are moving impulsively with a bullish bias. I continue to see XMR in a bullish cup and handle and will be looking to get dem gains. My linked ideas show my bullish set up on monero as well as my totally bearish set up on bitcoin.
INDEX:BTCUSDShort
by This_Guhy
1
NDX/SPY Continues to look like a bull trapI have been watching this formation develop for what feels like a year now and it is slowly grinding its way through and it seems we are finally on the verge of having the performance begin Generally speaking, since the dotcom crash NDX has gone up faster than SPY and so that has made it the bet for people to "just by the index" to make their gains. But now with this long term pattern forming it is signaling that NDX isn't the main bet to make. There are two main propositions from this formation: either SPY will start to outperform NDX to the upside or given the situation of the broader markets, NDX is going to lead the charge downward in a recession. Given how much negativity we see in the system combined with the topping pattern I think it will be the downside. If you compare the NDX/SPY chart to NDX you can see that these top formations on the pair do predict a dip on NDX. So far these dips on NDX have been great buying opportunities because they have been higher lows. Eventually NDX is going to print a lower low. After that lower low we are at risk for a lower high and that sets the bearish trend. Imbedded in the fib extension on the main chart is the notion that we are facing an ABC correction on NDX/SPY and we will see a C wave that is 1.618 or greater than the length of Wave A. If we look at the chart the last bit of serious price action has been between the 2.618 and 3 extension levels and so over the course of the next leg down I will be watching for NDX/SPY to chop its way down there for another consolidation. I am not sure most people are emotionally prepared for the long term targets. I have been watching for it and I am not sure I am emotionally prepared for this. People that buy the index to hold, whether it be retirement accounts or something else might not get to break even for over a decade. Last time NDX/SPY had a bull trap NDX went down 80% from here. Here is the annoying thing, both NDX and the pair had a bull trap. Right now NDX has just got done setting an all time high. If both the NDX/SPY pair and NDX were both looking at bull traps I think more people would take this seriously. Lots of questions remain unanswered if the broad conclusion of this post is correct. Will any bear market still be multi-year? What will happen to the money supply generally? Interest rates? All hard to predict if anything resembling the scope of what I think will happen will happen.
CME_MINI:NQ1!Short
by This_Guhy
4
DASHBTC apparently developing a head and shoulders at resistanceI had mocked up these bands on the chart with the intent of looking for places to take profit on upside moves but it appears that Dash isn't going to make it through the orange zone just yet. There has been a downward channel with a slight broadening aspect to it since 2017 and seeing a head and shoulders at channel resistance does not make me confident that price will be able to break through at this time. The target on the head and shoulders is shown with a fib retracement that and the primary targets are going to be the 1.618 and 2 levels. That puts us within this half mast continuation pattern on the flagpole that began the multi-year consolidation that created the orange zone. My system for determining bias shows that there was some reason for hope on the weekly chart when DASHBTC hit the VSTOP MTF x3 but we have not followed through. And it also seems that we have slipped the 20 week (again). The MACD is below zero and it appears to be poised to cycle another bearish MACD-Signal cross. It seems that Dash is poised to drop around 55 to 66 percent against bitcoin. Linked ideas will show reasons to be bearish about crypto. I still think Dash has a lot of long term potential but it is certainly getting dogged right now. I am certainly going to keep a long term watch on DASHBTC and especially this trendline resistance. Dashusd has been great for swing trades for me for a long time but every time I look to hodl dash it betrays me.
Short
by This_Guhy
6
Ethereum looks like a painful double topNot much to say. Kinda wrung out. This was a rather painful sell off and it happened right at the trend line which has played a significant role in price action for almost a year. I was hoping to see it flip one more to support as we did last September and November and I was expecting a lot of thrash until it became clear that the trendline was established. But after today's rejection it seems clear that this lower high has really been nailed in. Crypto double tops don't follow the strict requirements. Traditionally you are looking for the two tops to be within 5% of one another and these tops are not. They are close though, at about 8%, with a decimal off depending on exchange. Target setting The official entry for a double top is at the valley low, or in this case $1,700.48 for Binance. Waiting for confirmation for a technical entry is important because if it doesn't reach the valley low there is a 60% chance what you are looking at isn't a double top. And then the subsequent targets are in the waste bin. Once the valley low is reached the target is the launch platform or the base that provided the foundation for price rally. As I look at it it is the orange shaded area or the red shaded area. The VPVR shows that the possible double top formation occurs almost completely above the value area which contains 68% of all of the price action of this uptrend from the Covid 19 lows. Unfortunately my assumption is that this low volume means that retail "dumb" money was doing most of the buying and "smart" money selling tops. Below we see bitcoin from the point of breakout in mid 2016 to just prior to the dump in 2018 with the developing value area on top. Almost all of the price action at the top was way above the value area. Comparing the bitcoin from the last bear market to Ethereum right now we see that roughly how the same fib levels came into play, despite the formation being different. This does not mean that these targets will be run in the same way over the next couple of months to a year but it does show that using them for targets is not some absurd exercise. Likewise a long term target of the point of control is not absurd either. If you want to quibble about where I set the volume profile too feel free to tinker around and post your results. I found that the further back you go, the lower the point of control is. That's bearish. If this does turn out to be a double top then generally the route down will be quicker than the route up. And finally, a quick look at DXY on the monthly. It appears to have had a monthly MACD-Signal line cross after strengthening for a couple of months. Generally a dollar that is changing trend has an effect on bitcoin especially around the reversal. And BTC is still somewhat a bellwether for crypto, even though that relationship appears to be weakening. The dollar may strengthen for a year or more, surprising many, and ravishing crypto.
Short
by This_Guhy
2
Quickpost: Micro Head and shoulders on BTCUSD As always, a micro formation isn't going to have the same reliability as a formation that took over a month to form. Key things would be that this formation is lower than the $50,500 high set on August 23rd and it is forming on top of the trendline from BTCUSD all time high to the $50,500 high. Even though this high is just $50 lower it is a lower high. This is a key decision point for BTC and could potentially lead to disproportionate risk reward ratios. The linked ideas will show my broader bearishness.
Short
by This_Guhy
11
Quickpost BNBUSDT losing momentum after reaching key targetIntroduction Out of all the top coins since 2017 to right now BNB had one of the best bull runs. Therefore, if it is setting a bull trap I take that that is pretty scary and a bad indicator for the broader market. Analysis I consider hidden bearish divergence to be the bulltrap signal and as I look at the charts it is very visible on the RSI. So that gives us continuation to the downside from the peak to peak. Traditional or classic bearish divergence signals the end of a current uptrend and I see that on the MACD histogram. Also, the MACD is on the verge of closing a MACD-Signal line cross. Very bearish when taken into consideration with the divergences. Good news is the BNBUSDT chart is acting very technically. There was a symmetrical triangle that formed and when it broke it went right to target before stalling and now potentially reversing. Hopefully we can have the same chart clarity moving forward. Rough Targets One target would be an ABC correction at the 1.618 looking for an ABC correction Which is close to the 1 line on this fib channel.
Short
by This_Guhy
2
Solana reaches major Fib Channel Target (compare BNBUSD)This is basically a quickpost. The blue anchors show where both BNB and Sol have the fib log channels swing lows and a swing high point to define the fib log channel. Sol just closed at the op of the fib log channel 2 line. That is a very significant long term target after popping up out of a rising wedge. By my estimation most of the profits have already been made by going long. BNBUSD shows how powerful resistance at these levels can be. There is a lot of clear bearish divergence on the MACD histogram and the volume and gravestone candle spell reversal. Yesterday's candle was already down over 17% from the high. To me that loudly states a lot of profit taking at the 2 line of the fib log channel And just for the sake of the interested, here is your standard fib retracement. The golden pocket is often referred to the area between the 0.618 and the 0.65 retracement levels but I find that when doing retracements and extensions the 1.618 to 1.65 range works very well for targeting. And here he see it hit perfectly. I don't know what your trading system tells you. But mine says the upside is mostly gone. Personally, I am not touching Sol in the near future. I have clearer entries on other tokens and coins that I think are closer to trending. In other words, I suspect this will chop around quite a bit. It is still pretty early but I would be watching for something like the chart below to play out. Fractal ABC corrections all over the place that could be played out technically for those interested. Of course, not financial advice and I am not a CMT.
BINANCE:SOLUSDShort
by This_Guhy
11
Eth looks like a shortPrice has moved up for the last couple of days and with what I see I have put a short on and will be planning to take profit on this descending triangle structure. The main chart goes over a lot but lets expound At the left of the chart the Keltner Channel bottom acted primarily as support and price often went above the the Keltner channel and moved the bollinger band upward for months. There was topping behavior in May and we now have what I see is a clear descending triangle. The price action was closing whole candles below the Keltner. On the run up there are candle with bodies below the candle, but they had some structure in the Keltner. Whole candles below the Keltner signals a lot of selling pressure. Price action has dropped from the resistance of the triangle to the support when there where bearish K-D crosses. The middle red circle did require a double cross as the topping behavior went on a bit longer. This last and current black circle and red arrow may also require a double K-D cross. As I assess this, it is a high probability short due to the overall structure and time it has to develop as well at being at the Keltner when it has begun to act as resistance. On a lower time frame at the blue arrow I see lots of signs that ETH was topping here. Lots of wicks to the up and downside and the bodies getting very tight and then a clear red candle with no upside wick. The standard 4 hour candles show we had a symmetrical triangle structure that broke down after a MACD cross. This can still chop side ways or even up a little but there is a lot of bearish divergence on the 4 hour chart with the RSI. Between the daily descending triangle and that 4 hour MACD cross I see a high probability that we go down shortly. Stocks can get relatively tight.
Short
by This_Guhy
5
Bitcoin's recent volatility has not changed a bearish biasSo far Bitcoin has had a good couple of days and I see lots of people in real life as well online starting to get bullish and looking at putting on some big bets and so far I don't see the justification for that enthusiasm. I will link some ideas that make the macro bearish case to keep this post from ballooning even more. Analysis The bollinger bands can help determine trend merely by how they are angled... up, sideways or downward. You can also see "expansive" moves when the bollinger bands widen and you can see if it has been a really long time since the bottom of the bollinger band has been tested or if the top of the bollinger band has not been tested in a long time. Also, the daily VSTOP very close to the top of the daily BB. I suspect of volatility traders will be expecting the move to end here. The first thing that BTCUSD will have to do before I start to change my bearish bias is start to move the daily BB sideways and then start to get it to move upward. That process can take months so I don't feel I am missing out of I don't rush to put a trade on in the next couple of days. Again, there is is also a very real chance that price action gets ripped to shreds at the top of the daily BB and VSTOP. To be fair, the markets could potentially display a lot of upside potential. Here is the 3 day chart with both the standard and crypto ichi-moku cloud settings. The T-K displayed are for the crypto cloud and the high points are summarized on the chart. There are a lot of powerful moves in both directions when we are in the previous two black boxes but the ultimately we saw a bearish breakdown. It is just a very low probability scenario in my opinion. s3.tradingview.com My Trade Set Up thought Process As it stands on the 12 hour (and below) the RSI is already divergence to price action with hidden bearish divergence. Taking a short at or about the top of the daily BB would be a very technical move as the BB charts potential support and resistance and when it appears resistance or support is being met it can be evaluated with indicators. To try and limit any losses I am going to be waiting for a red shadowless Heikin Ashi candle on the 12 hour on BTC or other crypto to put my short order on. Target setting will be based on the idea BTC is in a head and shoulders. That means I am prepared to short this right shoulder to past the neckline but will be on guard for a return move to the neckline and then another rejection. If I don't get the red candle I want I wait. I can literally just evaluate the charts ever 12 hours for a couple of minutes while I check the list of coins I want to put my shorts on unless I am looking to write an idea. The linked ideas show how I set the macro trend and why I am using a low time frame (daily BB and 12h candles) to set my entry. If you review the watchlist from the main chart I am still on #1 of the watchlist. Which means I personally have a long way to go before I personally start to take longs or move out of stable coins. Rather than buying dips and selling into strength I am looking to short the rip. Linked Ideas summary The first three ideas are my system for confirming market bias using the Volatility Stop on multiple time frames in conjunction with some other simple and fundamental technical analysis. The VSTOP is based of a measure of volatility, the Average True Range. If you read all three you will see plenty of re-iterations of the same concept but you should understand why by bias is so bearish. The last idea is where I think we will see a major stall in downtrend and potential reversal.
BITSTAMP:BTCUSDShort
by This_Guhy
18
Head and Shoulders formation on MoneroXMR is one of my favorite projects and so I kinda feel bad shorting it but there is no virtue in losing money in the market as a trader. Often on charting you can look left to right to see what is going on but to get the best understanding I am going to go through how this chart actually developed so you can see it as I do. The purple trendline has been on my radar for literally years and I was very excited to see it turn into support in early 2021. From there rather than develop a bullish pattern I see instead a bearish pattern develop, a massive seven month long head and shoulders and I see that purple line has roughly failed as support. Given my overall sentiment that crypto is bearish I am looking to short. The Fibs set up my target setting from the a low on a rough neckline to the top of the head. There is a lot of wicking going on and so if price action breaks down and then has a relief rally a truer look at what the neckline was may be determined by the peak of that relief rally. Next up is some volume analysis to verify the fib target. I chose just before the formation of the purple trendline. Picking the Volume profile is bit of an art and that worked for me. This visible range lets us see the 1.618 is at a high volume node. Given the low volume node right below it we have to possible scenarios either we consolidate there, get above the Upper Value Area and probably set a new all time high, or we progress to the high volume node at around $50. A look at the moving averages shows that the $100 target is at the 300 week SMA, not a traditional SMA target. At that time frame and length the 300SMA is basically the 300 EMA as well. A look at the Monthly Keltner channel suggest that we could get really close to $70 by the time this bear market is over. That would make this whole formation a massive consolidation channel. Here is the formation I am using for my short entry. At 189 my margin sell order at 188 will be placed on the books. After that I will look at setting my take profit and stop losses.
POLONIEX:XMRUSDShort
by This_Guhy
4
Decades Long Rising Wedge on BAC (Targeting 80% loss)The main chart and title is pretty blunt. We see two rising wedges on BAC and the blue one predicted the 2008 crash, but because this is on the monthly chart it tools years for the price action to perform. We may again see this happen again as the crash begins moving in slow motion and is imperceptible to most as the problem becomes more and more severe. With the blue wedge price action tested previous action as support for about 6 months. The main reason I don't think people are aware of what is going on is they don't really look at monthly charts and if they do they don't think to always use the log scale on traditional equities, even though the price action goes from $1.6 to $50. Many may see this and not see any short term trades and may also just forget what is coming. Later they look back and go Doh! and I know I have made that same mistake. Get chopped up and stopped out looking for a margin long when I could have just held or stopped out looking for a short when I could have just bought the dip at target. It seems to me to be a time to pivot to plays around the market topping as well as preparing for a bear market and perhaps the social unrest that will bring. I personally will be looking to buy BAC or other equities for the long hold while around (below) the purple trend line. Stuff like this makes me think about what """They""" are thinking when they take years to distribute. There is probably a reason why in the 08 crash the SPX bottomed out at 666.
NYSE:BACShort
by This_Guhy
1
Update: QQQ/SPY Continues to Resemble BTC $60K topThis is acting as an update to the linked idea below where I make the case that it appears a broad sell off in equities is very possible based on the behavior of the QQQ/SPY ratio. It is a very rigorous look at the pair and the implications of any breakdown. If you want the full idea please check that out. The candles can appear red SPY goes up quicker than QQQ or if NDX goes down quicker than SPY and I believe that will be the scenario we will see. I believe we are seeing this topping pattern as people distribute their QQQ index holdings at a higher rate than their SPY holdings. I don't know of anywhere you can trade the QQQ/SPY spread but you could use this information to make long term calls if you wanted to trade any dips or rotate your savings and wealth into different assets. BTC appears to be developing a head and shoulders pattern that I believe a lot in the crypto space are in denial about (see the linked idea on that as well). Due to the volatility in BTC we saw a very vicious ABC sell off with AB being 2x that of BC on the log scale. I have QQQ/SPQY targeting for a ABC correction on the standard scale and the AB=CD looks very likely place for price to consolidate. I don't see a pattern as clear as the head and shoulders just yet. QQQ/SPY could still thrash around some more but until it gets back in the wedge I assume it is going to ABC down. The implications are severe. With a broad equities sell off we could see a cascade into crypto or commodities. I think in part the market is still dealing with the Archegos collapse and as these home offices and other institutions get more disciplined with leverage, lending and borrowing levels and who they trust we will see decrease of money in the market. That means that we go down as people unwind their risk and how far with the inflation anxiety remains to be seen. Those of you familiar with my work will recognize the implications of the charts below. If you would like to see the system detailed be review my linked Ethereum post below. Eevery single one of these charts could be fleshed out into its own post but I can't be bothered. Here is the weekly chart. If we AB=CD as shown above then we will be fully confirmed on a bear market on the weekly time frame. That is bad enough. If we see a AB=CD we also and closes a monthly candle below the monthly VSTOP/20 month SMA it is basically another dot.com bubble burst. And for funsies here is QQQSPY with the simplified cloud. It has twisted bearish.
TVC:NDQShort
by This_Guhy
5
BTC Chart Formations, Trendlines and DivergencesChart Patterns 2018 was an interesting time. Bitcoin had gone berserk and there where both prophets of prosperity and doom preaching about the future of bitcoin and all the new folks had to decide if they still wanted to play and what to do with their money. Lots of people correctly identified this descending triangle but many people were so bullish they saw it instead of being a triangle being a saucer or a cup and handle, basically anything but a bearish formation. I remember being uncertain as well, at times I played the triangle resistance very will with some outstanding shorts and other times I made some trash trades. It takes way more experience than people think to trust a chart formation and trust the targeting on it. Especially with triangles, they are some of the easiest of formations to recognize but they have some of the worst performance. The Head and shoulders is different. Mr. Bulkowski wrote one of the most important texts on charting with ranking patterns on chances of throwbacks, chances to get full performance, and average performance. The head and shoulders is 9 out of 36 for reaching target, so it is in the top quarter formations you could try to play. thepatternsite.com Stats on the head and shoulder from traditional markets Break even failure rate: 19% Average decline: 16% Pullback rate: 68% Percentage meeting price target: 51% Highlight from the trading tips Velocity: A high velocity rise leading to the pattern often results in a larger decline post breakout. Since we had a high velocity move into the pattern we can expect a larger decline than traditional targeting would suppose. But since we are on the log scale traditional targeting gets harder to do and so we have to use fib levels. And the target based on fibs alone is show and it is below the previous high. Trendlines Various chartists have correctly identified some long term trend lines that would act as support here and I have mocked one of them up in magenta. Thing is people were hoping for the exact same thing with the purple trendline before the big dump below $5.7k. Now obviously every chart formation is made out of support and resistance and therefore some trendlines. But trendlines flip from resistance to support all the time and when they fail they can fail to violent price action. Horizontal levels as well as angled trendlines can fail as support or resistance and you cannot guarantee that this magenta trendline, or a similar one, will hold forever. Divergence I am a big believer in divergences but I have many times looked at getting into a move way to early because I was not patient enough. Moves often will have a combination of hidden and cassic divergences in them. For a bullish example price action can display bullish divergence by setting a higher low on price and a lower low on the indicator but until that low has bullish divergence within itself it won't trigger, and that often occurs in waves of three. Hopefully this chart below will help. I don't forecast BTC having a sustained uptrend until we see classic bullish divergence on the weekly within the low that is still developing. Conclusion More downside and then a lot more upside. Until I get an invalidation of the head and shoulders or another major signal of trend change (like getting a whole candle above the 20 week SMA) I am still bearish. Please see the linked post for target setting.
COINBASE:BTCUSDShort
by This_Guhy
Blow off Tops for BTC, BNB, ETH and Total2Very curiously lots of people have been asking where the blow off tops have been for crypto because they are use to seeing blow off tops on crypto on weekly or monthly charts. As the market matures it begins to move a little slower and we can see that by looking at the newer coins, BND and ETH showing a blow off top on the 3 month but BTC showing the blow off top on the six month chart. This also leads to a broader point of what charts scale to use. This rejection wicks or profit taking wicks are very clear on the standard scale. They don't look so bad on the log scale. Also, lots of people crow about doing long term analysis but it seems they don't want to consider how bearish these candles are. Seriously, how can you be bullish on this?
BITSTAMP:BTCUSDShort
by This_Guhy
5