Justin W. 9:58 AM


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I'm looking for TT to throw up some bearish divergence if we top here at resistance. Such a signal on the eight hour time frame would be a good impetus for my bearish bias. Waddah Attar is helping to keep me out of a long position as well by showing me the weakness of the bulls at this point in time.

Structurally, Bitcoin is looking like a double top scenario at this 4000-4040 price level. Falling volume in a weak ascending channel also speaks to the weakness of bullish hands at this point in time. No strong indications to take any position at this point in time, because we do not have confirmation, or a liquidity run to take this trade short yet.

L/S Ratio is increasing slightly to the bullish side over the last couple of days, but you can see the massive hesitation from the bulls. Look at the swift decline in the L/S Ratio as price advanced back towards resistance, indicative of profit-taking as longs closed out their positions. Nobody feels comfortable longing resistance it seems. Sometimes retail gets it right.

Longs to Shorts Ratio

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Market Depth Ratio

Market Depth Ratio is bullish however, significantly so since last night.

Bid/Ask Sum

However the BitMEX BAS is bearish with rising open interest. Longs and Shorts continuing to put on positions within five percent of price. Although the rise in Open Interest is indicative that we haven't seen an event to end the trend, the reality is there is no strong trend at this point in time. Price is just sideways. Of course we're hopeful for it to break to the upside, but we don't trade hope here at CC, we trade statistically profitable setups.

Bull/Bear Income

BBI shows us that longs continue to be in profit, as shorts continue to become deeper underwater.

Based on all the above information, and knowing the way BitMEX evolves, I'm now looking for a volatile movement upwards for longs to take profit on, for shorts to get stopped out en masse on, and for everyone to go crazy over, before a swift capitulation back down to a reasonable support level. Highly speculative to take it long, best to wait for the right short entry.


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