BTC Ranging – Not chasing trades
Checking the markets again after the weekend. BTC has broken down form the range we were watching for. The next step now is to see how it reacts to the US market open coming up in about an hour from typing this.
There are a couple scenarios I am keeping an eye on shown in the chart below
BTC has been creeping back toward the range that it broke down from and how buyers/sellers react to this level will depend on how we trade it. I am favoring the short position and a bleed in price down to at least the white trendline shown. Selling pressure coming in at that purple/blue band is a good setup for shorts, which we can use some candle analysis to read that pressure as more data comes in.
Another update, albeit very similar. As BTC continues to range I am still remaining on the sidelines waiting for the trade opportunities to present themselves.
In conditions like we have had for the last 3-7 days, many altcoins become unpredictable. Some take off with pretty good momentum while others slowly bleed out. These are conditions that are not favorable to trade, as they become much more a game of chance and not a game of strategy.
The further BTC walks sideways, the closer it is coming into intersecting trendlines. When this happens, we get price compression or squeezing. Volatility will decrease in this area until the next impulse move occurs. This is what I am waiting on and observing while I let the market take its lull.
Don’t feel the need to always have to be in a trade.
I have realized I am not sharing many charts currently and thought to myself that when I was learning to trade, I took other people’s silence and thought “Oh no, Im on my own, I should go find some trades and make some money”. So I figured this was a post equally as valuable as a post where I am showing some trade setups.
To make it simple, I have not been posting as I have not been interested in trading currently. My strategy for trading is very much so trading when the market is trending. In the chart I have attached, I am not interested in trading while BTC is in this range. Many people will scalp the middle range, but that just isn’t my preferred style, too much work and stress for not enough gain in my opinion.
So what am I doing instead?
Well I am keeping an eye on this range, setting alerts so I know when BTC is close to the range boundaries. And more importantly, I am prepping for longs and shorts so I am ready for BTC to break the range either direction. There are many types of setups to find, some will paly out before BTC breaks the range and that’s just something we need to be ok with.
One particular setup that I like to find in these scenarios is something like this FXS setup below. It is in a range that is similar to BTC. Why do I like these? Mostly because the support and resistance are pretty clear, there isn’y much to clutter your thoughts like diagonal trendline, etc. Just a nice simple buyer block and seller block deciding who is stronger.
The icing on the cake for this setup in my opinion is that I think it’s incredibly enticing from a larger timeframe. This is a setup that I would be thrilled to trade as a long. So BTC breaks it’s range higher, FXS breaks it range higher at the same time, and we are off to the races and making some easy money. See the chart below for reference, but FXS recently broke out of a larger range and is now consolidating after that breakout. There isnt much overhead resistance to slow it down, so this would be a trade that I would take as a long (if it breaks out with BTC) and likely not set a take profit for and just let it run its course until it looks weak.
I will continue to search for these examples. while BTC ranges. If you find any that you like, feel free to share them with me and I can add them to our list as a community!