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Posts posted by TrendFollower

  1. Silver seems to be more in a more bullish mood compared to Gold. Platinum is too.

    Right now I have no conviction either way on whether Gold will go up or down. The only way one can try and get a feel on future direction is by following the US Dollar and looking out for any 'Risk On / Risk Off' situations such as equities tumbling down, potential war conflicts, economic recessions, political mayhem, etc. 

    When one looks at the chart some could see a weakening trend upwards leading to selling and a downward move. Others could argue that Gold is consolidating before its next move upwards. I would not want to go 'Long' or 'Short' at this juncture and would prefer to merely wait until the price action confirms the directional move as this is the only way you can stack the odds and probability in your favour should you choose to trade Gold by trading in the direction of Gold's price rather than against it. 

  2. Gold for me is still in an upward trend for now when one looks at the 'daily' chart. I include it below for your viewing.  It shows that Gold is still trading above its 'daily' 20, 50, 100 and 200 DMA's. If it breaks below its 20 DMA on the 'daily' then there is the potential for a larger drop down towards its 'daily' 50 DMA. The trend to me looks like it is weakening and there is some range bound activity once the market decides which direction it wants to go in next which for me will be depending on the US Dollar along with 'Political and Economic' risk / news. 


  3. Today Bitcoin has traded within the $9.8k to $10.9k rang which is over 1000 points.

    From a trading perspective especially for day traders and very short term traders this presents a fantastic trading opportunity as if you add leverage and trade in the direction of the short term move in Bitcoin then profits are there to be made. It will be extremely difficult of course as the intraday volatility is extreme to say the least. 

    I am sure some of you may be 'scalping'. 

  4. It seems Bitcoin is trying to push through an upward move. This may be a short covering move. There is not enough positive news right now for Bitcoin to push above $12k and stay there so I see the possibility of Bitcoin either participating in a volatile range bound activity or further declines in the short term. My view longer term is that Bitcoin will go for the $20k level once more positive Bitcoin news is released to the market. 

  5. @PJ19,

    This is a fascinating battle we are witnessing with those who are bullish on Bitcoin and those who are bearish. 

    The question is whether Bitcoin’s correction is setting itself up for a larger move upwards as there could be an aggressive short squeeze imminent. 

    I still think Bitcoin’s upward move is not done yet I am expecting it to revisit $20k in the coming months. I think September to December is going to be very interesting.

  6. I try and ignore 'market noise' though I admit I am guilty of reading it. Maybe I should not read it but I certainly try my best to base my trading decisions based on price action rather online media content. 

    Just today I have read some reports agreeing with Trump's comments on Bitcoin. I have also read some comments stating that the mere fact that a US President mentioned Bitcoin is positive in itself as you just cannot beat that level of free publicity. Also it is that the US is fearful of the potential that Crypto's like Bitcoin could challenge the US Dollar in years to come.

    I have read reports suggesting that this may be the last time we may see Bitcoin at lower than $10k levels and other reports suggesting that Bitcoin could go down to $9k and even $8k.

    Bitcoin's price behaviour is extremely volatile. In fact I cannot recall any commodity that I have traded and I include Natural Gas and Crude Oil that has demonstrated more extreme volatility than Bitcoin. 

    Bitcoin is proving to be the 'King of Volatility' and this presents great shorting opportunities both on the 'long' side and 'short' side. It is 'price volatility' that creates great trading opportunities. 

  7. Bitcoin is still remarkably above the recent low of $10295.00 which is pretty remarkable.

    For how long I do not know as $10k is being tested to the limit right now. If it breaks then I do fear a more deeper correction but if it holds then it is going to set up Bitcoin for another go above $14k. That is how I see it right now but my view can and most probably will change as the price behaviour in the coming few days will show us the narrative that it wants to perform. 

  8. @PJ19,

    I myself would play it slightly differently in that I would wait for the confirmation of an uptrend before adding to my position (adding on the dips as the price reverses back upwards). 

    This will have no doubt scared a lot of traders and wrong footed them. This is extreme price volatility and extreme amplified price corrections at its best. Many traders who have experienced trading Bitcoin will have experienced this many times. 

    I think the 'alt coins' are being hammered far more at the moment as they are even more riskier than Bitcoin. 

    This coming week should be interesting. I still think those who are short should hold their shorts until there is a clear indication of a reversal. This could involve fake reversals and all sorts so it is going to be extremely challenging for more shorter term traders but this is where their skill and ability will come in. Not easy that is for sure. 

  9. @PJ19,

    Interesting. It seems Bitcoin found support at $10,295.00 but the strength of the price action is so strong that I now cannot rule out further downward price action. I do not know what will happen overnight or tomorrow morning but the momentum seems to be with Bitcoin's price declining but it can turn in the matter of minutes and catch a lot of traders off guard. 

    Normally with such solid declines over the course of days Bitcoin tends to bounce big. It will be interesting to see if Bitcoin can hold that crucial $10k level. 

  10. At some point you have to 'anticipate' future price movements as that is in essence what trading is in my personal opinion. You are anticipating the future direction of the price to make a profit. I do not like using the word predicting as that is something none of us can do with any high degree of accuracy as otherwise we would be on a private island that we own. 

    Now I tend to use the 'anticipation and then the testing of that anticipation via price action' model but there are many others which can be used. 

    A lot of people use support and resistance but I think it is important which asset they are trading. If it is a wild and volatile asset which is extremely high risk, one must understand that support and resistance may not hold. One must also understand that a major breakout may not occur even if support and resistance has not held. In my view all there are is important price points and nothing more. There can be false breakouts and trend reversals at such price areas. This is what catches a lot of traders out. One of the indicators you could use is the momentum indicator to see if the move has the potential to become a strong trend. Also you could use support and resistance for potential trade entries and trade exits. You could use them when considering setting stop losses. 

    I appreciate that many will not like the word but we are 'speculating'. There is nothing wrong with speculating. The aim is to make as much profit as possible and our trading plan must articulate how we intend to do this.

    In my personal opinion trading in the direction of the trend will give you the best chance to profit. 

  11. It seems Bitcoin is heading towards the 'daily' recent low of around $10.4k level based on the current price action. The $10k level is crucial as if Bitcoin cannot defend that for a second time then I fear it may open the floodgates for further bearish price action.

    A crucial time is coming for the current Bitcoin upward trend. It has gone below its 20 DMA which is a short term bearish signal.

    $9.8k on the 'daily' represents the 50 DMA. If this is breached then it could leader to a deeper downward dive in terms of price action due to 'amplification' which in my terms is profit taking + stop losses being triggered + short positions increasing. 

  12. @PJ19,

    I have no idea if what you think will happen based on this chart will happen or not. The one thing I know is that Cryptocurrencies are unpredictable at the best of times. Also there are no rules or regulations that force Bitcoin's price to behave according to Elliott Wave Theory or any other technical analysis (though I accept it might end up following it). Historical price action does not necessarily lead to future price behaviour. 

    For me I entered my Bitcoin 'Long' trade a while back and have been holding my trade and adding to it to date on any major dips. I have paid the daily overnight charges and am not worried about the short term price movements, volatility, market noise, so called Crypto expert predictions, complex technical analysis, etc. I have just held. This is the beauty for me of trend following. It allows me to take a directional position and then I can use my spare time to do what I want. I don't have to worry any complexities day to day. My exit will be executed on a trend reversal based on my parameters (which is slightly wider than text book) just so I do not get caught by any false reversals (to catch stop losses being triggered). 

  13. @PJ19,

    I too am bearish on Gold 'Long Term'. I just cannot see in a digital age and digital revolution taking place that the future generations are going to have as much Gold in their portfolio as the older generations.

    I too think that short term Gold may go up with all the political and economic uncertainty and risk but longer term I see it value declining as the younger generation allocate their capital to alternative assets to Gold. 

  14. Whether you agree or not that Bitcoin will become 'Digital Gold', one must accept that you can earn greater profits trading Bitcoin than if you buy and sell Gold. That is fact since Bitcoin's inception. So the best way I can describe this that Bitcoin is like Gold investment but for the 'Digital Age'. 

    Now over a year ago the media and the people who believe the media (market noise) were all convinced that Bitcoin was a 'bubble' far worse than 'Tulip Mania'. It is funny how this very same media is not mentioning bubbles as Bitcoin touched $14k from around $3.5k!

    I do not recall (someone correct me if I am wrong) that when the so called 'bubble' in the price of Tulip's occurred and then it crashed that it went back up to make even new highs. I cannot remember how many times Bitcoin is supposed to have died but there it is as strong and resilient as ever. The bubble noise has come and gone and Bitcoin is still here. The bubble argument has been destroyed in my opinion.

    The mere fact that President Trump has come out and belittled Bitcoin tells me he is worried and scared. The strength of the US Dollar as the world's reserve currency is under threat. Not by Gold but more likely by Bitcoin. If you asked the Russians, Chinese, Japanese, Middle Eastern countries and the Scandinavian countries which they would want, I have a feeling they would opt for Bitcoin over the US Dollar. The US Dollar (which also kind of dictates the price of Gold) gives the US unbelievable power over the rest of the world. The rest of the world want this power reduced. They need an alternative to the US dollar which no one country controls. Answer, Bitcoin!

  15. Moving Averages are widely used in Trend Following Trading Systems. My Trend Following Trading System is no different. Just to put things into perspective with regards to Bitcoin and its current trend from a 'daily' chart perspective I include the chart below. I find that use 'Daily' and sometimes even 'Weekly' and 'Monthly' charts are better for following longer term trends than the short time periods but each to their own. 


    For me there is no confirmation of a trend reversal. Bitcoin on the 'daily' timeframe is still trading above its 20 (only just), 50, 100 and 200 DMA's so the longer term uptrend is still in tact for me. If anything Bitcoin seems to have found support above the $11k level which seems bullish to me. 

    It seems Bitcoin is taking a pause for breath and consolidating before its next leg up. There seems to be more chance of $14k being hit and then $15k being hit than Bitcoin going down to $6k to $8k levels. However, this is Bitcoin and it can act in a way that we least expect so nothing can be put off the table. 

    I always believe in keeping things simple when trend following and asset like Bitcoin. The more complicated we make it the more difficult it becomes to even action a trade as complex technical analysis will always give us a reason why not to trade Bitcoin. Based on price action alone, Bitcoin, still looks good!