Halving passed and now what?
It is a pleasure to write for you and, before entering the topic, I would like to thank all this incredible community for the reception you gave me in my last post My presentation for Project HOPE. You have made me feel part of it. I want to thank all the users who took the time to express their thoughts and opinions in the article comments. read the presentation here if you haven't already
Special thanks to: @juanmolina @lanzjoseg @hardaeborla @fucho80 @jadams2k18 @crypto.piotr @franyeligonzalez @reinaldoverdu @awah @streamingnews @unbaisedwriter
I am going to deal with a topic that is currently on everyone's mouths: the price of bitcoin. There was a lot of speculation about Halving, something we commented on in another article. Will Bitcoin meet the expectations of miners and investors? As I explained there, Halving on its own, despite being an historic coin event, is just an scheduled protocol that has little to do with price formation directly.
Price formation is a process that corresponds to certain factors that occur through professional money. The allocation of professional money in a position can be both the cause of a process generated within the market and its effect on the accumulation or distribution of capital. Simply, for the price to rise, there cannot be an offer that exceeds the disposition of demand. What happens in reverse when the price takes a bearish direction. This only happens if professional traders or, as some call them, strong market hands take weak hands out of the game.
That is, if they want to go long, they liquidate all those short positions on their way, so that the upward price can be released. If and only if they have the necessary strength. How do they do that? Eating or sweeping the stop-loss of the sale orders, since every sale that touches the stop automatically transforms into a purchase that adds to the bullish party of the professional. This is done in such a way that there is no counterpart and the price can rise without problems, because in this way purchases support sales. Of course, this has a limit and always at some point the accumulated capital must be distributed and the opposite process is generated that takes with it all those operators who were caught in the upward trap.
I highlight with this the fact that Halving by itself does not mean anything. There is no denying that market sentiment is bullish, of course it is. But no matter how long everyone wants to go, it cannot be denied that if the professional cannot start the rocket at $ 9,500, he will seek to take the liquidity lower, to a point where the offer is scarce enough and can sweep with her. The market responds to a naturalness.
I always say that one cannot be fooled by pure speculation. Some people commented in my introductory article that they want investment advice or not to lose on investments and to give some winning entries. I'm sorry to disappoint you, but I can't do that. Because the only ones who can tell you where to enter or exit a position are yourself and the market. I don't want to sound rude. The reality of the market is like this, raw. Day by day, you on your own with yourself.
What I want to reach with these writings and others in the line of the discipline of trading, is to offer you a lens with which to see the market. In which also, beyond what you can learn from me, it will be you who decides what to do and when to do it. I do not pretend to be a trading guru. I want you to shine a light on yourself with facts. And the path of learning is infinite. What I can tell you, yes, is that trading systems are destined to fail and little by little we will see why. And by the way, there will always be losses. If someone tells you that you will not lose by trading, never believe a word of it.
Are there still bullish symptoms inside BTC?
If we look at Bitcoin from a broad perspective, we see that the price is moving in a bullish channel. This took great liquidity in the oversold line to a low of $ 3,600 on March 12. At this point, there is a strong accumulation zone where demand was repositioned strongly, to raise the price again in the following days, in a bullish channel of a lesser degree that can be seen in graph 1D.
However, we see that at the $ 9923 level there is still a strong offer that has pushed the price back. This does not mean that the bulls' opportunity is over. If we look closely, we see that despite the offer pressure at those levels, they have not been able to push the price below $ 8,560. A price that the demand gained in the session of April 29, leaving the bullish accumulation range that precedes it. This means that professional demand has not been withdrawn from the game.
And currently what about the price?
Chart 1W
From May 7 to 14 a balance zone generated between $ 10,000 and $ 8,500 is defined in the asset, this movement is commonly known as range. It is in a crucial area for the market where it can make a cycle change. It is breaking the declining sequence of prices that has come on since September 11, 2017. This signals to us that professional money is on the table and that investor interest is encouraged. But what is equilibrium within the market? As everything in the market is a paradox, don't let this sound strange to you, the professionals themselves do not know what to do with the price and for this reason it is oscillating in the aforementioned price range.
BTC price Wyckoff structure you can read more (spanish) here
I do not want to speculate and say here that this last movement that is being generated is an exhaustion of the offer, because we cannot get ahead of ourselves. Remember that price predictions do not exist. What we do know is that there is an increasing sequence in the lows, which favors the bullish cause, which causes the offer to fail at the price of $ 8,500. Will this have the desired effect? We do not know. And believe me when I tell you that no one knows.
What could give us a bearish strength signal?
If the professional demand is withdrawn again between $ 9,900 and $ 10,000 and there is a drop in the price below $ 8,400, consolidating with a close in minimums, there we could start talking about a partial withdrawal of the demand. This would cause the bitcoin price to go lower.
What can I conclude from all this?
We have to let the price develop. I believe that the professional still does not take a clear path. I feel that the offer is still strong and that the demand needs to consolidate above the critical levels. Bitcoin is an extremely noble and special asset compared to the rest, but the price is also a natural manifestation of the human being and responds to the needs that allow it to behave in one way or another. As much as it is of bitcoins or any other asset, they will always be forced to the natural law of the market.
If you are an experienced investor, I recommend that you pay attention to the movements that give clear signals and accompany those movements. If you are a novice, first learn and then invest. I know that bitcoin investments can be fascinating, but you can also be amazed at how quickly they can make you lose money.
I am bullish relative to Bitcoin and I strongly believe in saving and buying in bitcoin for the future and in other Blockchain projects that are really promising. But this cannot be a reason to be blinded either. I hope this article has been useful to you. Please leave your comment, I am excited to hear about the community's feeling about BTC.
100% original content created for Project Hope by Alejandro Aristeguieta
My other bitcoin articles this week (in spanish)
Análisis de Mercado: Inicia la semana y Bitcoin Supera los 10.000$
Análisis de Mercado: Bitcoin: Sesión 2 de Junio. ¿Superando los 10.000$?
Análisis de Mercado: 8500$ podría ser un objetivo inmediato antes de los 10.000$ para BTC
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Alejandro Aristeguieta
CEO in Aristeguieta Capital.
Investment Firm and Financial Analysis.
I started using the term d.chain a few months ago because I thought that factors like I listed above would determine the fate of the crypto industry. Decentralized blockchains like Bitcoin will see a need for p2p payment settlements as centralized organizations aggressively pursue options to traditional money. The battle I see is if Bitcoin can prove to be a better option in the eyes of the masses.
I don't focus my vision on this article on whether BTC or crypto in general can or not. But with regard to the debate on whether or not Halving is the gasoline that the BTC market needs to free the price up. However, paradoxically I debate this. I think the price responds to a naturalness as I say in the article, and due to the fact that halving happens or there are external factors such as those you mention, the price is also a natural formation that needs certain factors to generate movements.
Thank you for your participation and opinion, a hug.
I'd take the same sort of perspective if I thought BTC reached the freedom point where enough people are interested and liquidity is competitive enough. I think wee need a couple of trillion market cap to be at that point.
In terms of the Halving, I see this like the slow accumulation of solar power
:)
ty for the functional engagement.
It may be that if it is, I think this year will be very interesting for the crypto economy