Where is the next meaningful support based on price structure? The low 24K area. This means if you buy Bitcoin right now with no regard for this risk, you are looking at a potential 2 to 3K pt profit vs. at least a potential 4K pt loss. Looking to win 2 while risking 4 makes absolutely no sense and is an unprofitable outcome in the long run. In terms of probability, Bitcoin needs to run to around 34K to justify this risk. What are the chances it can do this? There is no way to pin point a precise number but it is within reason to expect the risk of retrace to be very high at the levels, especially in the face of a psychological RESISTANCE area.
When markets get overly speculative or “frothy” they will look like nothing will stop them. Combine that with all the hype and exaggeration that follows across the internet, and you will be convinced this thing is going to 50K over the next 3 hours. As we regularly remind our members, high quality swing trade opportunities DO NOT look like this. High probability buy signals do not usually occur at peaks. This is the herd mentality driving this at the moment and only good for those who are in from much lower prices.
We had shared an aggressive swing trade at 24,150 a week ago and exited around the 26,300 area (upon the bearish pin bar). Was this a mistake? If you say yes because we missed another 3K of profits, you are looking at it from the eyes of the herd. We locked in our second 2K pt profit for the month, nothing wrong with that. Selling at the precise high or buying at the precise low is a very low probability game and one that amateurs consume themselves with.
So at this point we wait for a support. Will it be 24K? It might be, or price may find support sooner, but either way, we need to wait for a price structure and setup where we can measure a reward/risk that makes sense. If you would like to learn more about our strategy, visit: https://bit.ly/marketsignals
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Enjoy your holidays and thank you for considering my analysis.