IS THIS THE END OF THE CORRECTION?

Updated

I'm sorry for not publishing my idea a few days ago. However I have been expecting a correction like this since November. About every 60 days BTC goes through a cycle where it has a major correction. Usually the correction touches the 20 day MA (moving average) on the weekly chart. The last large correction we had we didn't even come close to that (RED ARROW) and we shot up like a rocket from there. We were bound to correct. As long as we are still in a bullish trend the price should not drop below the 20 MA on the weekly chart. Could the price drop back down to retest that area? Yes it is possible. But if it does and bounces off of it, that would constitute a double bottom and a buy sign for most traders. I would expect strong buying from there.

If price corrects further and drops below the 20 day MA on the weekly chart and candles close below it, we would possibly be entering a bear market. I don't expect this with the whole world's eye on Bitcoin. Unless something drastic happens like Tether (USDT) going belly up.

So is the correction over? We just had a break out on the 1-2 hr chart from the consolidation that we have been in. There has not been as much volume as I would have liked to have seen, but it does look positive. We will next have to test and break through the down trend line in order to say that we are out of the correction in my opinion.

I did add new positions the other day with ETH when price was about $800. I didn't buy BTC, and wish I did. I thought we would likely see the price drop back down to retest the lows before going up so I was waiting it out. Right now I am just watching to see what unfolds over the next few days. Please keep in mind that this may take a couple weeks before we retest the highs of 19k if we continue going up.

Good luck out there. Don't invest more than you can afford to lose. Everything that I have invested in this space I did so with full knowledge that I could lose everything. However I believe that there is a lot of potential for growth in the crypto space.

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It looks as though we may be dropping back down to re-test the lows. Ordinarily I'd say we would drop as low as the .618 level on the FIB retracement (about 11k) because this area also coincides with the 100 day MA on the daily chart. However market sentiment has been bearish and people are still scared. This may lead to further selling to the 20 day MA on the weekly chart (around 9k). However like stated before if it dips this low I believe it will be brief. So if I am a buyer at these levels, I'd would have my buy areas predetermined. This will at least offer good trading opportunities for the quick buy ups at these levels and can possibly help increase our cash holding if traded correctly and market cooperates. Remember that trading and investing are different strategies.

Could it go lower than that? Yes absolutely. Could it not reach that level? Also possible. Gotta love that certainty right? ;)

BTW now that I'm done writing this it looks like we are about the test the 11k level. Lets see if it holds up. Good luck.

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FULL DISCLOSURE: I sold the ETH I purchased for $800 during the last correction in anticipation to buy lower when price drops. The selling is pretty strong and it appears that the correction will continue until keys levels are reached and buyers take back over. It looks like most buyers are on the sidelines for now.

I will be purchasing BTC on this dip if opportunity presents itself. Because if these lower levels hold up and create a double bottom I believe buyers and investors/traders will see it as a good buy opportunity for investments and swing trades.

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Keep in mind I did not and do not sell all my ETH. Only the few that I purchased for swing trades to increase my cash stack. If I'm wrong and buyers take over from here I am happy with the gains I made. And I will look to enter a trade when the opportunity presents itself. If I'm right then I have more cash on hand for more trade opportunities at lower prices. Either way trades are to increase cash or BTC (depending on what your are trading against). A win is a win. The "dang it I could've made more if I..." approach has caused me to make bad decisions in the past.

Also the reason I am posting about my ETH trade on a BTC chart is because well, lets face it, everything is pretty much following BTC right now and that is the chart my eye is on.

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Sorry wrong chart

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Volume is picking up a little, however sellers still appear to have control. I expect another drop into the buy zone. The 20 day MA on the weekly chart now corresponds with the $9500 price range and we could see a quick drop below that. After the drop I expect the daily candle to close above the 100 day MA on the daily chart (over 11k). I will be a buyer if we reach the buy zone with the intent of a swing trade to take profits around 13.5k- (down trend line).

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This correction is a tough one. As being relatively new to the crypto market (6 months), I have only see about 5-6 corrections take place. Earlier in Sept. the correction lasted a couple weeks but then after that corrections only seemed to last a few days to a week at the most. Most of the time never hitting my anticipated target low to buy in.

This correction is lasting longer than expected. Perhaps that is the way corrections should play out but it is unnerving. It's hard to quote Warren Buffet on a crypto post because he thinks crypto currency will have a bad ending, however "Be fearful when others are greedy, and greedy when others are fearful" keeps playing over in my head this morning.

I could go on to name candle formations that could be positive but may not play out, or RSI levels that have not been reached yet like in other corrections last year. However the things that I see that give me the most hope for the future of crypto currency is not on the charts. It is the news. Everyone is talking about Bitcoin and blockchain technology. Countries and State governments have begun to make room for blockchain tech to be used to store data (i.e. Colorado). Large business are partnering and funding smart contract coins and setting up for the future move in that direction. People with a lot more money and a lot more experience are investing millions of dollars into this space. Every time I read through news articles I see more corporations getting involved. They see the promise of profit in blockchain's future.

Will all coins that are on coinmarketcap have a place in that future. No. But that is where fundamental analysis of the coins you chose to hold will be important. Recently IMO, crap coins have skyrocketed because people thought that they were cool, even though their white paper was junk and there was no way to prove the experience of the team working on the project that we invest our hard earned money into. If there is a further and harsher correction from here, these coins likely won't survive the storm. Choose wisely.

If we hold support here and go up to reach new highs and the market continues bullish. Lets use this correction as a learning opportunity to be prepared for the day we do crash (if that happens).

I do believe there is a great future for this space and that we have an opportunity to profit greatly. And I will be looking for opportunities to add to my positions in this correction.

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We had a breakout. It looks as though we may be trading in this pennant for the time being. Keep an eye to see which way it breaks out of the pennant. If up we will likely test the larger scale down trend line. If down, new lows are likely.

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Today was definitely a more positive day for BTC. It got a C+ rating from Weiss Ratings which helped give it a little push. A C+ rating is a hold signal according to their rating system. D or F would be sell. Additionally we closed the daily candle above the 100 day MA. I will be looking to see if that holds and if so we should likely see a breakout on the smaller pennant upward to test down trend line.

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Bitcoin is trying to break out in an upward direction on the 1 hr chart. Hopefully the bulls take over from here. Keep a close eye on it. If you trade break outs make sure it doesn't do a "fake out break out". Meaning it will likely break out then correct back down a bit. That is when it is a better time to decide to enter the trade. See which direction it heads after the small correction on the break out. Also a confirmation could be if it goes higher than the previous high. Lets say $11,700 on the coinbase chart to be safe.

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That being said we do not yet have the volume so this could be a pre-mature call. It is just intended to have you watch it. If volume increases that is a strong confirmation IMO. I don't see that yet.

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The last 3 failed breakouts created a down trend pattern so I have adjusted my trend lines to touch the tips to those highs. This has been relatively uneventful.

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Well we did break out to the upward side of the pennant that was formed. Which is good news for longs. However we have a lot of resistance ahead before reaching 20k again. First is the 100 day MA on the daily chart. Once we begin to close above this I think we will see faster moves up. We are not out of the woods yet.

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Wow this has been a rough one. Next strong support is the 200 day MA on the daily chart around 8k. However people are panic selling right now so it is capable of dropping below that before reversing. I like many of you have money tied up in crypto and some at much higher prices because ALTS took such a large hit. Lets hope the 200 day MA holds. If all goes well again I will keep this in mind for next year. As a U.S. resident there was a new tax bill passed that taxes us on each trade. So I held through December when my portfolio was peaking because I didn't want to take the tax hit. Lesson learned. I will be taking profits when they come and holding only some. I don't think any of us were expecting this.

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We had a strong bounce off the 200 day MA on the daily chart last night. Lets hope this level holds. Am I opening new positions right now? No I'm not personally. I only have a few thousand left in USD in my trading account because I bought to hold at higher levels 10.5k. I will look to see stability at this area and higher higher/higher lows form before I add my final position. I am not looking to bring new money into the space right now in addition to my trading account for one simple reason. It's winter and Im a project manager for a roofing company that works off commission for a living. It's not the time for me personally to take from my nest egg to invest. Otherwise if I was on the sidelines waiting for a time to enter the crypto space, I would be heavily looking into these levels to consider entering.

On a TA related stance, we bounce off the 200 day MA, there is decent support around this area, and volume is up as high as it's been since late december. RSI levels hit below 30 and we are likely close to a reversal. We could definitely go lower but from my perspective, the end of the correction is in sight. Let's hope I'm not wrong.

I am not selling my positions at these low levels. I am going to hold through this because my investment is long term. Will I take profits if price goes back up? Absolutely! I learned my lesson through all this. But now is not the time for me to back out and take losses on some trades.

sonoferik

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