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The Wolf Den #11 - Bitcoin, Large Caps, Beyond Meat And Sleep Trading!

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I once again find myself going through a heavy analysis on Bitcoin and a number of other coins and, o
 
January 10 · Issue #11 · View online
The Wolf Den Crypto Newsletter
I once again find myself going through a heavy analysis on Bitcoin and a number of other coins and, once again, find that the best way to share all of my thoughts with you is in a newsletter rather than on Twitter. I absolutely love this format, as it allows me to gather everything together in one place.
Paid members have already received two full newsletters this week. Yesterday, I covered all of their chart requests, which included $BTC, $ATOM, $BCH, $BQX, $EOS, $HOT, $IOST, $LEND, $LTC, $POE and $XTZ. It was a ton of work, but actually alerted me to some amazing trade opportunities. Tuesday was a full version of the newsletter, which included the following.

  1. Bitcoin analysis
  2. South Korea and crypto taxes
  3. My Altcoin trades
  4. Plan your losses
  5. What is an STO?
  6. Fed repo
  7. Tesla trade for 2.5x
You can join the paid newsletter (it’s only $15!!!!) here:
As always, if you cannot use a credit card for any reason, please contact me directly and I will allow you to pay in crypto!

BTC Thoughts
I have absolutely overtraded Bitcoin this week, largely because I do not short and have been looking for long opportunities on the belief that price is likely to continue up once again. Still, I was not following my rules closely and was a bit overaggressive.
As I stated in a previous Wolf Den, I viewed the $8200-$8400 area as a likely place for price to top out. I closed my trades from $7350 (after going long from $6800 to $7350 last week) in that area. For shorters, $8400 was a very clear level in retrospect.
I attempted to long multiple times between $8000 and $8200 and took a couple of small losses and tiny gains after moving stops into profit. It was somewhat poor trading that I look forward to evaluating in the coming days to help myself improve. My risk was managed well, which is the key takeaway.
The Wolf Of All Streets
$BTC

Filled my orders at $7,777 and at the red line at $7,875. A few hidden bull divs. Price held the 21 EMA and closed back above the top of the old range (red). Those are all of the things I was hoping for from this candle. Could still go either way but my criteria are filled. https://t.co/c6dgwV6T1h
3:02 PM - 9 Jan 2020
I went long once again from my favorite monthly line on the chart - $7,777. Price tapped this area yesterday TO THE DOLLAR and bounced. I added to that position at $7,875 which was a previous swing high. Price reached $8,000 and I was honestly feeling a bit cocky. Bad. Price QUICKLY dropped and hard. Leveraged longs and shorts were both being destroyed in a single 4 hour candle. I had moved my stop up to $7,850 and quickly was knocked out of the trade, but in overall profit.
A couple of days ago, I decided to place a buy order in conjunction with the CME gap (grey box above), since it’s the talk of the town. I filled orders around $7,700 and woke up in great profit.
The gap did NOT technically fill, as price failed to reach the bottom. Hopefully we can move on from this narrative anyway.
A note on CME Gaps - I am still not a huge believer, but they are worth watching because everyone has their eyes on them. The CME stops trading EVERY SINGLE WEEKEND. This means that ANYTIME price goes up over the weekend, it will leave a gap on the daily chart. This makes for a pretty annoying narrative.
There is a bullish aspect to the narrative - and that is the pink gap on the CME chart that still remains above 11K! You can see it above.
Bitcoin once again looks very bullish to me with confirmed hidden bullish divergence on the 4 hour chart and a massive candle brewing. Price is once again trading above the 21 EMA. I am feeling confident in my current position, which more than covers any losses I incurred in the past few days.
As I have discussed a number of times, Bitcoin has been trading in two key ranges. It finally escaped the infernal range that it has been stuck in for months - the blue one. It reentered the red range on the move up and has held since. Let’s zoom in and take a closer look below.
Price temporarily reentered the blue range, which was not at all encouraging. That said, most traders were not thinking about the red range that price had just broken back into. Look where the previous two 4 hour candles closed. RIGHT on the bottom support of the red range. Beautiful TA.
The single largest reason that I have remained bullish on this downswing is VOLUME. VOLUME AND PRICE ARE EVERYTHING IN TRADING! So what was I seeing that has kept me optimistic?
During the rise from $6800 to $8400, volume was rising with price. Volume and price were in AGREEMENT, which is a sign of a solid trend. After topping out, price started to drop, but so did volume. Price and volume ceased to be in agreement, meaning that we were likely seeing consolidation rather than a new trend. For it to be a new bearish trend, you would want to see volume rising with the price drop. Volume appears to once again be rising with price - hopefully the uptrend is starting once again.
Large Cap Altcoins
Yesterday, I was watching the USD pairs of a number of large cap coins and noticed that many of them were hitting key resistance and dropping. As you know, USD pairs move largely with Bitcoin, so looking at them on other coins can provide us information as to what Bitcoin is likely to do. This made me a bit weary of Bitcoin, which did drop a few hundreds dollars after the fact. That said, when coins consolidate hard against resistance, it becomes likely that resistance will break. Let’s take a look at a few large caps and see what’s happening.
Side note - I was looking at these because paid members asked me to chart a few of them. Having you guys ask me to look at coins actually helped my trading, because I was able to identify some trends across these coins and take a few trades!
BCH/USD
As discussed in the paid newsletter yesterday, price was consolidating against the top of the descending channel. You will see this trend in EVERY coin that I discuss in this section. Locally, price broke out of an ascending channel and was retesting resistance as support in the grey box. 2 areas of former resistance being tested as support together. As you can see price is now breaking out of the downtrend. Need to see a candle close to confirm.
EOS/USD
A member asked me to chart this yesterday, so I shared this chart for the paid subscribers. EOS looks amazing on the USD pair. Price broke out of the descending channel that it has been in since May of last year. This one led the pack, as the others were still in the channel yesterday. As a result, I took a position on the retest of descending resistance as support - $2.72. This is where price was roughly hanging when I shared it yesterday and it looked like a very clear and bullish retest.
ETH/USD
The ETH Daily chart shows that price is still consolidating against the key resistance on the chart - the top of the channel from June of 2018 which signifies the long term down trend. Price is presently bouncing with Bitcoin and held the 21 EMA perfectly. This should blast through resistance if Bitcoin continues up.
LTC/USD
Like the others, Litecoin is also attempting to break out of it’s longterm downtrend. Not much else to say! Candle close above the descending line today would confirm.
BYND - Beyond Meat Inc. - 1/9 Entry
Trends are made to be broken. Beyond Meat has been in a massive downtrend since topping out in July. I posted the head and shoulders pattern at the time and regretted failing to take the opportunity to short. That said, I have been watching for a sign that price was reversing and saw it 2 days ago. I took this trade at $84 yesterday on the clean breakout. Further, there’s a clear gap on the chart that is likely to be filled, which tops out at $97.85.
Massive and quick trade here. If it fills the gap, I will likely sell some and reevaluate. Price is presently at $97.35.
I Make My Best Trades In My Sleep
The Wolf Of All Streets
I always joke that I make my best trades when I’m sleeping. I set orders, close the charts and wake up well in profit. Proof that staring at the chart is more likely to cause a poor decision than to make you $.
7:45 AM - 10 Jan 2020
Quick note about trading in general. I have always found that my best trades are the ones that I plan long in advance and wait patiently for. Because of the CME gap that everyone was watching, I placed low ball Bitcoin orders two days ago. These filled while I was sleeping last night - when I woke up price was already up a few hundred dollars and I was able to move my stop loss comfortably into profit. This is how I executed my best alt coin trades in 2017 as well.
Staring at a chart all day is more likely to make you overanalyze small time frames, causing you to miss the big picture and the best trades. Make a plan, close the chart and let the market come to you.
The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor.
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