• Henk ter Linde

Ok. That was fun...

I deliberately held off publishing this post till the big short squeeze, followed by the liquidation of the longs. Those who follow me on Twitter will know I felt you could see this coming a mile away. So I will reuse some of my charts that I posted there...

The biggest signal was the fact that we were still being held back by that long term resistance. Any sign of breaking through would send a lot of FOMO traders in a frenzy. Also there were a lot of short traders with a SL around 10.5. I think a lot got saved by whomever prevented BTC to rise above 10.5. Whomever that was, (s)(t)he(y) deserve cake. Lots of cake. That is assuming they don't do a double whammy and let it rise back to 10.6 now before crushing more hopes and dreams.

Now the week has barely started, but the simple fact is that if BTC doesn't manage to eliminate that SFP, we are going down hard. So basically we have two options: 1. The Bulls show up and move BTC straight back to the 10K zone and attempt to break 10.1 somewhere around the weekly close. Preferably > 10.5, but I don't see that happening. If it does, this market has become officially un-tradable. That would be sheer manipulation and it means that price and value have no relationship anymore. (And yes, that is what I think already...)

2. The Bears go for the kill and push BTC straight back into the low 8s, which may lead to a new set of cascading liquidations. Somewhere in the mid to low 7s, if we're lucky (or unlucky, depending on your position). Somehow, this feels more natural...

So, all hope is lost? Well... I am not sure but I would not be surprised if we see the bulls attempting this (re-)correction sooner rather than later. I am by the way pretty sure that all the big operators in this market are neither bulls nor bears. They are just making money... Your money. The chart gives them some footholds to attempt a push back up. It also show clearly when that opportunity has been invalidated (short term).

As I always say: never bet against the 12 hr Stochastic. So my instinct tells me we are going down but if I wanted some of that sweet, sweet short liquidity.... Well, it is more or less a casino. So, as always: trade safe, manage risk and don't sell grandma just yet. Also, be nice to each other. Crazy times.

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