Bitcoin is bullish baby! After weeks of fear, uncertainty, and doubt, Bitcoin is finally putting in some nice big greenies to the upside. The Crypto Market rejoices as some of those who just started trading this year are realizing their first profits! Congratulations to all of us, old and new.
Starting with the Daily Timeframe, we can see that the Regular Bullish Divergence (per the RSI) that we spotted last week has/is played/playing out, propelling prices up 20% off the recent bottom. RSI is now above 50, indicating that we are in what is known as the 'Bullish Control Zone.' Most interestingly, look at Nominal Volume, or real volume in terms of USD. See how much volume has come in over the last four days? This is an incredibly positive sign for Bitcoin moving forward.
Analyzing Bitcoin through our Pathways to Profit Trading Strategy, we can see several things. First, all of our major moving averages are curling up and our faster moving averages are beginning to cross above our slower moving averages. This indicates a trend reversal, and as long as the price of Bitcoin remains above these faster moving averages, it bodes well.
We are also trading above the Daily Base Line today, our prerequisite for considering an asset to be in a Bullish Trend. We have a ways to go before any significant MA resistance.
All of our Momentum Indicators are flashing positive signs, and in fact today calls for another Primary Long position on Bitcoin: this time due to a Big Daily Breakout. Waddah Attar Explosion is showing positive delta with a rising Explosion Level, Mynx is above zero, and Parallox is also above zero. We're not overextended or overbought. A beautiful trade setup!
Overall, our Stop and Target system is predicting at least a 12% move to the upside for Bitcoin this week.
Zooming into the lower time frames, we can see that Open Interest is on the rise and Cumulative Volume Delta is consistently tracking up, indicating that buyers are still in control. Funding did dip negative, however it is on the rise back towards positive and I expect that even if this is a pico top (which I don't think), we still have to see another round of big short liquidations before this train turns back around.
Altcoins of Interest:
Large Open Interest Changes:
#1 REEF USDT
#2 RVN USDT
#3 RAY USDT
#4 CREAM USDT
#5 HBAR USDT
These assets had large changes in overnight Open Interest, and this is usually the first place I go to look for trades. I did take positions on REEF, RVN, and CREAM. I wanted to take a position on RAY, but it just wasn't so clear to me which direction to trade. In situations where I'm not sure what the right thing to do is, the right thing to do is to do nothing. The point and goal of having a trading strategy is to minimize frustration, increase efficiency and performance, and reduce emotional stress. If you have to think about a trade, then move on to the next.
Strong and Oversold:
Here I track altcoins of buying interest due to having oversold on-chain status while simultaneously show casing strong on-chain demand.
#1 Dogecoin (DOGE)
#2 HEX (HEX)
#3 Cronos (CRO)
#4 MagicCraft (MCRT)
Dogecoin is interesting, as is HEX. Those two have consistently been on our Strong and Oversold screener for the past two weeks. Let's take a look at a Santiment chart of Dogecoin.
Here we can see a big spike in Daily Active Addresses around September 7th during a price dip. This is usually indicative of on-chain demand and seller absorption as wallets accumulate larger positions. This occurred around the price of $0.059. This will likely serve as a strong support level, and indicates bullishness coming forward.
The chart of HEX is also constructive. We can see a consistent elevation of Daily Active Addresses and on-chain volume. It appears to me that HEX is being accumulated as it trends downwards, perhaps you should as well?
I would recommend adding HEX and DOGE coin to your spot holdings, no more than a 5% allocation of trading capital. I would close the positions in the event of a significant reversal in market trend, or more specifically, if DOGE loses it's support of $0.059. I would hold these positions until the market gets overheated, which I will of course signal for.
Bitcoin is looking beautiful, and the altcoin market is continuing to heat up. I know we have just suffered through a nasty bearish trend, and it might not be over in the long term, but these are the moments we've been waiting for. When trades come easy, and prices trend up. Don't sit on your laurels, get out there and get some trades in!
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