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bitcoin long period of consolidation

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Bitcoin et al continue to drop with no end in sight.  It is a mania not a bubble.  Who will buy bitcoins if they hit the Death zone?  Everyone who is pro bitcoin is in and will be seriously under water...

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I think Bitcoin will revert back to the mean before the 'immense speculation' began. I see Bitcoin going down to the $1k - $1.9k levels. This is only my personal opinion. I am still positive on Cryptocurrencies, Blockchain and Tokenisation. I have witnessed large corrections before so I am not really surprised or shocked with this current correction. 

I have not seen anything to suggest it is going down to zero or is about to become worthless. I don't physically own any Cryptocurrencies and never have as I do not know which tokens will succeed. Therefore I have only merely traded Cryptocurrencies and still do via Spread Betting based on price action.

@Mercury if you believe your own analysis and instincts then you should have profited handsomely from the 'short' trade on Bitcoin. It was one of the best short trades around in 2018. How many trades were there in 2018 that were better shorts than Bitcoin? I am not talking about individual stocks. I mean any commodity, bond, indices or major large cap share?

Traders will always come up with reasons why they would not short Bitcoin et al but trading the right opportunities at the right time can seriously enhance the profitability of a traders portfolio and some of these opportunities do not come up that often. The very traders who went long on Bitcoin unto 20k which have shorted it down to current levels so they will have profited handsomely on the way up and on the way down. 

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I don't trade Crypto period!  I consider that you have to trade what you are comfortable with.  I have been watching and waiting for the biggest shorting opportunity any of us are likely to see and have Shorted that.  It is about keeping your power dry for the right opportunity.  Crypto is a Mania, I wouldn't touch it with a barge pole, neither Long nor Short, but that's just me.

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No, you are wrong there, the bitcoin bubble, rise and fall was easily the best long then short since markets were ever organised engulfing the previous champion 'the Tulip bubble' by a long way.

So the 'biggest shorting opportunity any of us are likely to see' has already been and gone while you are still waiting.

I'm sure you haven't forgotten we already had a whole year of this 'end of days' big short coming stuff all through 2016 only to see price break out of a long period of consolidation to the up side and into a year long bull run.

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Edited by Caseynotes
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Oh dear!  So it all going to happen again and stock will run hot again eh?  But thanks for proving me right there that Bitcoin is the biggest Mania of them all.  Nuff Zed...

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Thank you @Caseynotes. Totally agree with you. 

@Mercury, sometimes the best trading opportunities are 'bubbles' or 'mania' or what ever you want to call them. It does not matter. It is just a word. Are you able to name a single trade on indices, commodities or bonds that was a better opportunity not just in 2018 but now in 2017 so to go long in 2017 and then short that very asset in 2018? The profit potential on this trade was phenomonal. 

Can you actually name a better trade in these two years on the same asset? Your trade in terms of the best opportunity has not actually manifested itself. It may happen, it may not. This has actually happened over 2017 and and 2018 and the whole world witnessed it. 

You state you have to trade what you are comfortable with. These are just words. A trade is a trade when using price action. It does not matter what the asset is. You are entering the trade and exiting it. You are going 'long' or going 'short'. You will use the very same analysis and indicators to aid your decision. We are not talking about physically acquiring Bitcoin just like not physically acquiring Lumber, Orange Juice, Corn, Wheat et al.

As I stated before the best trades are those very 'mania' type activity.

You seem to be shorting what is in your opinion the best shorting opportunity any of us are ever likely to see. You do not know this. This is your opinion which is fine. Therefore you are shorting on 'hope' and require 'luck' as the price action does not support your view at this moment in time. It may well do in the future going forwards but none of us have a crystal ball. Someone like you would have had a strong opinion on Bitcoin going down from 20k levels so you would have had the conviction. I am sure you may well have a stronger conviction on your current short so time will tell if you are right on this.

If a trader only trades what they are comfortable with (reason not to trade something) then they could be missing out on even participating in huge trends and some of the most profitable trends. If a trader uses certain indicators and analysis then why can this not be used for different assets based on where the strongest trends are emerging? I mainly trade Commodities and Cryptocurrencies but if a strong trend materialised in Bonds, Gilts or Indices then I would not have any issue trading them. It is about trading the best trending opportunities out there. One of the key skills is to identify them in the first place and then have the ability to execute a trade on them. Trading is not supposed to be easy. In fact it is extremely difficult. It is those traders that come out of their comfort zone which stand a chance of being hugely profitable based on the profit potential available. I accept that you cannot trade everything due to capital requirements and limitations. Therefore trading the biggest and strongest trends is not a bad strategy in my opinion. I have not traded numerous things over the past few couple of years but picked what I thought were strong (long and short) trends in Cryptocurrencies and Commodities.

The question for me personally would be have I missed a better trading opportunity anywhere else than say Bitcoin in that same time period and I am not so sure I have. 

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@Mercury,

As I have stated previously (though I accept you may not be aware) I separate my investing and trading. So I invest in 'Equities' (all around the world - no region is off limits) for long term capital growth and wealth creation. I use 'Pound Cost Averaging' and then invest lump sums on major corrections and drops. This has served me very well over many years. I invest in micro small caps and small caps around the globe, frontier markets, emerging markets, specific technology themes such as 'Robotics', 'Automation' and 'Artificial Intelligence'. 

I mainly trade Commodities and Cryptocurrencies at this moment in time. However, I have an open mind and will trade any asset should a strong trend and potential (attractive) risk/reward opportunity arises. I have traded Gold and Silver before but have stayed away for several years. It was your analysis and posts on Gold and Silver that got me interested and hence I have long positions on both Gold and Silver at this moment in time. I am short Natural Gas and Bitcoin at the moment. I did go long on Ripple and Stellar recently but got stopped out and the trade went against me so it was an unsuccessful trade but this is fine. I was long Lumber and Orange Juice and then short Lumber and Orange Juice earlier on in the year.

@Mercury, what do you specifically trade? I have losing trades just like many other traders. For example I had losing trades on Ripple and Stellar recently. I currently have active losing trades on Silver and Gold. The key for me is to ensure that my profits outweigh my losses. Thankfully I have winning trades (both happen to be shorts) on Bitcoin and Natural Gas. 

It is not about being right or wrong. I may be wrong on many accounts. I actually think some of the points you make are very interesting and worth consideration. You may think most of my points are garbage. That is fine. I think it is fair to say that we will disagree on Cryptocurrencies as an asset class and its merits from trading both a long and short perspective. I think as an asset class it is here to stay. Yes, it will evolve, change and improve over the years to come but it does not seem like it is going anywhere soon. Old participants will leave forever and new participants will emerge. 

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First of all this is not a buy recommendation only a topic for discussion

Is there any chance of this to be some kind of valid bottom? (FA?)

any chance of at least a bearmarket rally?

its a daily chart of Bitcoin showing a potential head and shoulder bottom (if i can attach it)

 

 

 

 

Bitcoin 2019 daily.png

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On ‎14‎/‎11‎/‎2018 at 16:30, elle said:

chart update 

Capture bit.PNG

chart updates

Capture bit d.PNG

Capture bit 4.PNG

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@Kodiak,

I still think there is potentially more movement downwards to come. I think we have seen potential head and shoulders before in Bitcoin.

I would not want to go long any of the Cryptocurrencies until the price behaviour leads to clear signals and indicators and even then it is extremely tricky. I went long both on Ripple and Stellar a while back and made losses on both even though the price was above the 20, 50 and 100 day moving averages and may have even crossed the 200 too but that still did not enable me to participate in both successful and profitable trades. 

The error I made was ignoring the long term trend which was down. I should have known better with my experience and knowledge and yet I still made that mistake. The long term trend needs to change before I start going long on any of the Cryptocurrencies. If this means I miss out getting in at the bottom or earlier then so be it. I want to catch the middle 'big' part of the trend.

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@Kodiak, that is an interesting chart and bitcoin does seem to be in tune with Awesome (think colour of bars rather than above/below zero) and with the divergence as well . Not supposing a massive retracement but quite possible that there is room to the upside.

Is interesting to see the degree to which all cryptos are big long with IG clients atm. You need to click on each one to find the approx number of clients long. Not always a contrarian indicator. 

@cryptotrader mentioned a possible crypto rally just recent in another thread.

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bitcoin currently sat above the 20 day MA, but below the 50. On the hourly looks more to be searching out direction and relatively range bound between the 3600 and 3900...

Volumes and news hopefully pushing the markets higher.

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@Caseynotes,

😀, yes that pattern looks like an 'up and down' or 'up along the bridge and back down again' type of pattern!

Cryptocurrencies (with the exception of those like Tron) and especially those offered by IG on its platform are all showing strong downward trends and strong downward bias. I got suckered into those relief rallies with Ripple and Stellar a few months ago and though I cut my losses short and quickly it highlighted clearly to me not to trade against the long term trend on Cryptocurrencies.

The long term trend is 'down' and I went 'long' on Ripple and Stellar. For day traders and short term swing traders that is fine but I am a more longer term trader and I look for strong long trends which I can ride. The frustrating part for me is that I have been short Bitcoin so why on earth I decided to go long Ripple and Stellar is beyond me.

Cryptos tend to rally hard upwards but they end up going lower and lower. Until a clear bottom is formed and is tested with a 'double bottom' I would not want to go long any of the Cryptocurrencies right now. The only play is short and has been for the last 12 months. 

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@TrendFollower,  I know, I think a whole new branch of chart patterns needs to be written up specially for crypto, am keeping my eyes peeled for a goal post pattern next.

Of note though in both that recent up surge and then the down surge both were done and pretty much completed on just a 5 minute candle - social media organised pumping? 

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@Caseynotes,

There are rumours of 'news releases' being manipulated on not just social media but on online media in general that 'so called' specialises in Cryptocurrencies. When this news is released on online media it begins to attract those looking to make quick money on Cryptocurrencies and we know how that ends.

Even after the current price action I remain positive on Cryptocurrencies as an asset class. My view still has not changed, so far!

I think there is more downward movement to come but once the asset class does bottom and all the junk and garbage is removed only then will we see real upwards trending long term movements in Cryptocurrencies in general.

I don't even think (as title of this thread states) we are at the long period of consolidation on Bitcoin yet. 

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