Talk about a crushing day! Stock market down, crypto market down! These times are trying and un-nerving to many that are new to investing and trading, and understandably. These are the times that separate the weak from the strong. If you are nervous and can not hold through these types of corrections in a speculative market then bottom line you put too much money in the market! You have to be able to hold tight through down markets and look for opportunity when most feel its the end.
I am not going to candy coat it. We have pulled back farther than I thought we would. One item of note on the chart is the huge volume spike. Now normally I do not rely on volume as an indicator but when you see a spike like this or like the spike we saw close to the stock market close today, you have to wonder if this was not a large investor pushing through margins to create the sellers they need to buy up at a discount. This has been happening for as long as markets have existed. Large investors use their buying or selling power to move the market the direction they want for their benefit, especially if they can do this around some FUD news. See below for a comment from the written testimony of J. Christopher Giancarlo, Chairman of the CFTC. Hardly the doom and gloom report, its quite the opposite. Odd this spike happen shortly after the report was released. But lets look at the charts.
We hit an odd 0.786 retracement level that has me even wondering if we go lower. Maybe we do, but selling here is as risky as buying at 18k in my opinion. We can surely pullback into the 4th wave of the recent midterm cycle. A break of 6427 tonight MAY put this into play sooner rather than later. If you have been following for more than a month, we are still sitting on a nice cash pile, and cash is king in corrections. Now I am not saying we will hit 5000, but the odds have increased that we may. The next Fibb levels are between 4431 and 4688. But lets first see if 6247 holds and see how the market reacts to the hearing tomorrow before jumping to conclusions as markets can turn on a dime. I would not be surprised on the other hand to see a rebound over night especially with the testimonies released today.
Please stop with the FUD about China banning bitcoin. Its simply regulating unscrupulous ICO's, exchanges, and insuring money is not being illegally transferred out of country. This is simply scare tactics. I was actually reading the Chinese Securities Regulatory Commissions (CSRC) regulations today to dig deeper and get the facts.
Unless you are in a 100% cash your portfolio is down over the past few weeks period, so please spare me the I called the paper short with no skin in the game comments. I can not guarantee I will always be right, and I have never claimed to time the top or bottom of a market, but one thing I can guarantee you is that I have skin in the game, and my trades are real, unlike many "paper traders". I'm right here with you and I am not even thinking of selling.
I'm taking a nap, getting up in a few hours, putting on my big boy pants, making some coffee and doing some research. I will be going over the testimonies of both the CFTC and SEC chairman before the hearing! I'm looking for an edge. I am also going to finish researching the CSRC regulations and see if I can garner any factual information that provides an edge as well and I will provide an update on my findings. Not misquotes or statements out of context, but factual research.
Bottom Line: If you want to make money like the Buffets and Rothschilds, you have to think like them! You have to dig where nobody else is digging. You have to have nerves of steel and willing to buy when everyone else is scared and selling. Bottom line you have to act contrarian to the herd. That's where the big money is made in markets. Not being with the status quo!
"The time to buy is when there's blood in the streets, even if the blood is your own" Baron Rothschild
Kommentar
⋅
"We are entering a new digital era in world financial markets. As we saw with the development of the Internet, we cannot put the technology genie back in the bottle. Virtual currencies mark a paradigm shift in how we think about payments, traditional financial processes, and engaging in economic activity. Ignoring these developments will not make them go away, nor is it a responsible regulatory response. The evolution of these assets, their volatility, and the interest they attract from a rising global millennial population demand serious examination. With the proper balance of sound policy, regulatory oversight and private sector innovation, new technologies will allow American markets to evolve in responsible ways and continue to grow our economy and increase prosperity. This hearing is an important part of finding that balance" J. CHRISTOPHER GIANCARLO CHAIRMAN, COMMODITY FUTURES TRADING COMMISSION
Let's not get too excited but we definitely had a nice bounced since the hearing today. We are testing the median of the channel as well as are looking to find support at the 0.618 retracement of the overall move from 175 to 19500. This again is positive for the bulls. What I want to see is the 0.618 to hold, and a breakout of the channel above the 8398 level which is the 0.382 retracement of the correction. Now normally I do not use volume as an indicator but I put it up there to see if there was more buying then selling right now as a sentiment indicator. Clearly this is the strongest buying we have had since Dec.
Until we break the 9860 level we are still in a bear market. But this reversal has provided insight as to where we can gauge future positions. It will be interesting to see how the market reacts to Asia tonight.
Hey Goldbug, Long time no talk.... I use Sierra Charts to trade bitcoin on Bitmex. Most people are not aware what a DOM is, but I am sure you do, I have been observing something interesting on my DOM, when we were at the 20k level, the lack of liquidity was getting worse as we moved there. It was so bad that my strategy simply was getting stopped out on entry, prior to that I was able to day trade this with as little as a $250 stoploss, and then I started seeing $250 dollar spreads between the bid and ask. I started losing a lot of money So I got out of Bitcoin and went into cash & Cryptos while I had my manual stratagy I was doing coded into an Algo to compete.
I am about to launch this algo, and I am looking at the Order Book on the DOM and the spreads are so big that I have to scroll my screen just to see the bid/ask prices. With that said, this is not really a sell off, it is a serious liquidity issue, Everybody is holding. My other observation is that I can see the Market Makers algos patterns, when I day trade this its like a head game between Me and the Algo and Once you see its buying and selling patterns, you can tell Its not a Human on the otherside, as a matter of fact there are a lot of algos running this show. Anyways, I can sit and watch this thing lift the market and Drop this market with no liquidity, it basically owns this market on Bitmex anyways..
When I clip into a trade with 30 to 50 thousand contracts at a time, and there is 100 thousand contracts sittin on the offer side, the little Fucker is so fast that it will pull its orders faster than mine can take a third of its order, I might get 5 thousand filled on a 30 thousand clip in, no human is that fast, this is just like the Stock & Futures market issues. So one tell tale sign that I am about to lose my ass is that if I get the entire order filled to easy, I know something bad is gonna happen so I bail on it. When its hard to get my entire order filled, I know I am on the right side of the market and I am gonna make some money, It took many hours of staring at the DOM and trading against this robot to learn this. Anyways I started clipping in with 5000 contracts at a time over 5 to 10 minutes just cherry picking only the best offers this tyrant of a bot would flash for a few seconds, and everytime I was doing this around the 16 to 20k BTC price, the robot would push the market against me everytime and try to get me to puke up those contracts at a loss, so I would keep buying as it lowered the price, and the market was so thin that I had to fill the book with my own orders on the bid to keep the price from jumping down to the next order whihch would be about $250 dollars away sometimes, this is how empty the book really is. So I noticed another thing, When ever I filled the book with my own orders, the robot noticed this and it would not take those orders, it pushed the market up and I had to chase the little fucker up to get filled. I think the Market Makers Bot or bots are partially the cause for this drop along with lack of lquidity, I dont think there is a major sell off, there are not enough buyers or sellers that I can see so the bots keeping lowering the price in search of liquidity, and I am seeing the same patterns again, this bot is accumulating and taking traders money for really really cheap. Who knows how far it will push it down but I am thinking about actually buying around here and becoming a HODLR for the first time. I just wanted to share this story, I use a proffessional platform, not the webbased versions most people use so I see a lot more information than you will ever see on a webbased trading platform. I would imagine these bots are widespread across all the major exchanges, I have heard rumors that a lot of the MM bots are from the same group and the bots share information across exchange platforms. I just found this all interesting and thought I would share.
BarrenWaffe
⋅
@Netrunner, wow this is sick. This probably also explains why all altcoin prices following bitcoin that quickly.
Netrunner
⋅
@BarrenWaffe, That is what I am thinking, All my cryptos including either are tracking Bitcoin now, same chart patterns, I wonder if these Algos have now been deployed across a wider scope of Popular cryptos.
sushrest
⋅
@Netrunner, i think these bots are following a trend which is down currently.... there must be some sort of event they look for to act completely the opposite (this could be manual)...
KISStheProfit
⋅
@Netrunner, They are mainly on the pairs that run the other Alts. The patterns are on BTC, ETH, NEO mainly, and BCH a bit. The patterns are on every exchange. Can you figure out how powerful is that thing?
KISStheProfit
⋅
@KISStheProfit, I forgot to tell you, that when a certain alt is more activelly traded (the alts from the top 20 lets say) the AI also gets in there and doing the things you described. When XLM was moving, I was there trading, and it was there as well. But usually it works with millions USDT wash trades with the major market making coins.
Also most recent stockmarket crash is blamed to be a result of algorithm trading
Netrunner
⋅
@BarrenWaffe, I have been hearing this as well, but that was a good article. I have not heard of a case like this where their has been research and investigation done. Thanks for the link!
KISStheProfit
⋅
@Netrunner, It is not only Bitmex, it is Binance, it is Bitfinex. For first time I would drop the abreviation AI..Do you understand what I mean. I also tried to fight with this unhuman thing, but it is not possible. Sure it is run by people, but it is spread on all exchanges and on all major coins that rule the others. It is so fast and random, predicting human trader behavior, that it is a pure luck if you can win against.
KISStheProfit
⋅
So, your observations are right, the BOT is draining peoples accounts on the way down. I have writting this the whole January in my small analysis. I am not proffessional trader, but invest quite a lot on traditional markets, and just got in the deep here. The outcome is the BOT and someone very powerfull running is manipulates all major exchanges. You can see that in the indicators, the speed a volumes as well. The trading book on all liquid exchanges is also giving this with the big spread. It is simply almost impossible day traiding here. I believe that soon or later people will start to panic sell off, because the Bot already drained several billions, and the new commers are nowhere here.
I am about to launch this algo, and I am looking at the Order Book on the DOM and the spreads are so big that I have to scroll my screen just to see the bid/ask prices. With that said, this is not really a sell off, it is a serious liquidity issue, Everybody is holding. My other observation is that I can see the Market Makers algos patterns, when I day trade this its like a head game between Me and the Algo and Once you see its buying and selling patterns, you can tell Its not a Human on the otherside, as a matter of fact there are a lot of algos running this show. Anyways, I can sit and watch this thing lift the market and Drop this market with no liquidity, it basically owns this market on Bitmex anyways..
When I clip into a trade with 30 to 50 thousand contracts at a time, and there is 100 thousand contracts sittin on the offer side, the little Fucker is so fast that it will pull its orders faster than mine can take a third of its order, I might get 5 thousand filled on a 30 thousand clip in, no human is that fast, this is just like the Stock & Futures market issues. So one tell tale sign that I am about to lose my ass is that if I get the entire order filled to easy, I know something bad is gonna happen so I bail on it. When its hard to get my entire order filled, I know I am on the right side of the market and I am gonna make some money, It took many hours of staring at the DOM and trading against this robot to learn this. Anyways I started clipping in with 5000 contracts at a time over 5 to 10 minutes just cherry picking only the best offers this tyrant of a bot would flash for a few seconds, and everytime I was doing this around the 16 to 20k BTC price, the robot would push the market against me everytime and try to get me to puke up those contracts at a loss, so I would keep buying as it lowered the price, and the market was so thin that I had to fill the book with my own orders on the bid to keep the price from jumping down to the next order whihch would be about $250 dollars away sometimes, this is how empty the book really is. So I noticed another thing, When ever I filled the book with my own orders, the robot noticed this and it would not take those orders, it pushed the market up and I had to chase the little fucker up to get filled. I think the Market Makers Bot or bots are partially the cause for this drop along with lack of lquidity, I dont think there is a major sell off, there are not enough buyers or sellers that I can see so the bots keeping lowering the price in search of liquidity, and I am seeing the same patterns again, this bot is accumulating and taking traders money for really really cheap. Who knows how far it will push it down but I am thinking about actually buying around here and becoming a HODLR for the first time. I just wanted to share this story, I use a proffessional platform, not the webbased versions most people use so I see a lot more information than you will ever see on a webbased trading platform. I would imagine these bots are widespread across all the major exchanges, I have heard rumors that a lot of the MM bots are from the same group and the bots share information across exchange platforms. I just found this all interesting and thought I would share.