BTC TA the easy way – stuck in the doldrums below $10k big move due?

When it comes to trading Bitcoin, the topmost cryptocurrency around, the best strategy is as a long term investor or “hodler” as they like to term it in the industry. In that way you can relax and simply watch the price of your investment climb over a period of years. Those who like to trade short term, to scalp a bit extra or pursue day trading, may have to subject themselves to much more risk. And as Warren Buffet, one of the top veteran stock market traders in the world said – success is as much about wealth preservation as it is about accumulation, if I may paraphrase.

Personally I have remained a long term investor in Bitcoin, and have left day trading for the risk takers. I will still keep an eye on the price and buy the dip as I am confident that Bitcoin is on it’s next bull run to a new ATH all time high in the next two years. Those reading this will probably be familiar with cryptocurrency already and know that Bitcoin has just finished its halving, a regular four year event which precedes any bull run or price spike. This, in itself, is the main indicator that now is the right time to invest in Bitcoin for the coming two years. If you buy in now at around $9-10 000 per Bitcoin, you are predicted to 10x your investment, or make ten times the amount you invested. Price is said to be on its way to $100k, as a ballpark figure, and could spike way higher briefly. However, an estimate of $100k per Bitcoin is a safe expectation. No other investment in the world can offer you that safely. And with Bitcoin’s history over the past 11 years of repeatedly following the same pattern in price, it appears to be a safe investment with spectacular returns.

Now if we look at the current Bitcoin price chart, which you can find on tradingview.com, we can apply our insights of the science and art of technical analysis or TA. There are indicators that tell us a lot about the state of the price, based on the past movement and thus a likely future scenario. However, when looking at the speculations of other TA experts, we can see that many concur on several fronts, but some use different settings for their indicators and so there is always room for differing opinions. No one can say for sure if price is headed up or down on a daily basis, even if the long term trend appears to be bullish. For example I like to look at the “Moving Averages”, whether EMA or SMA. We can follow the price average based on the past 20, 50, 100 and 200 days, and the lines of average based on that will show us where Bitcoin price may find support if falling or resistance if climbing. Currently on the daily chart we can see the convergence of the 20 day and the 50 day Mas in the mid $9000 range. Price is being squeezed in between these two lines of average price as they move towards a meeting sometime in the coming few days. Simultaneously the 100 and 200 day EMAs are close to each other around just over $9000.

With the noticeable lack of volume in the trading charts in recent weeks, as well as the even more noticeable lack of volatility, price looks ready for an explosion or breakout. But which way will the price spike – to the upside or the downside? And the attempt at forecasting that for the short term is where TA experts and traders in general may differ in opinion. We can look at our indicators and try to predict, but with the current look of price action, it is very difficult to actually call the move. Therefore, the best advice is not to pre-empt price but rather wait and react to the move when it happens. And then simply buy or sell into the prevailing trend as it unfolds. There is no use trying to predict the top or bottom of a move. Seasoned traders rather trade with the trend as it presents itself.

Considering that the Bitcoin price has been trying repeatedly to break the psychological big even of the $10000 resistance for about six weeks now, the coming breakout or explosion in price movement could just as easily drop as it could climb. I have seen conflicting opinions from experts, and so will not personally try to call the move ahead of time. We simply sit and observe the trend and have our plan ready for both scenarios. As a long term investor, of course, I have no short term trades to enter or exit, and won’t be selling, regardless of any price decline because I believe that the overall trend is bullish long term. So if there is now a short term drop in price to an earlier level of support, then I will be ready to buy the dip, to stack up on sats, to invest still more at the bargain price.

As price now hovers below the 20 day and is busy falling below the 50 day MA, it looks like Bitcoin may be on a downward trend. If this is the case, then a natural support may be found, for example, at the 100 and 200 Mas, which sit at just above $8000. I would see that as a likely next level of support. There are many other options, like the reference to the CME gap still present on the 8 hour chart all the way down at $3500. These gaps apparently always get filled at some point, implying that price has to fall that low to fill that gap, even if only for a moment, though I would be very surprised. Other traders and TA analysts may bring our attention to the 200 weekly MA around $6000 as a possible floor of support for any falling price.

So as you can see, there are numerous speculations, and therefore it may be safest to use stop loss if you are day trading or swing trading, otherwise just buy and “hodl” for long term profits this year and next. Fundamentals regarding mining, banning, institutional investors entering the market, stock to flow ratio, and so many others, may be valuable if you wish to investigate them, but for a simple long term investor, they all amount to noise in the market and don’t affect the overall long term bullish marco-economic trend of Bitcoin in its 11th year of age. Please do your own research and never invest more than you are willing to lose. In other words keep your day job, don’t sell your crucial assets or take a massive loan to trade Bitcoin as you may lose out. Simply put some small percentage of your savings into a Bitcoin investment and make a tidy profit in two years from now. That’s what I’m doing, so this is just my opinion and not investment advice. I’m a self-taught amateur, so DYOR is the key mantra here today.