Going short BTCUSDT with some healthy caution..

21. Juli 2018

Here's my case for a potential short opportunity BTCUSDT on a 4h chart. Bitcoin is playing out along a major resistance level of this s/r range and hasn't had enough momentum to break through at this stage. We had a false bullish breakout that liquidated everything in its way last night, and whats evident, is a clear bearish divergence on both oscillators (lower highs), 3rd red Heikin Ashi candle indicating a retrace, 8 & 13 EMAs squeezing together, and red volume bars dominating. I've gone in short here based on the above, and considering a retrace to .5 or .618 fib levels. The key thing here for me though is reducing the potential for loss. I enter every trade these days with this in mind. Even though there are bearish signals, the market can go against you, so it becomes all about risk management. My stop loss was positioned above the previous high.. luckily I wasn't taken out with this recent spike, so Im still in a short position. This is another example of why NOT to set up tight stop losses. We all want to make money and I know from my own experience the internal struggle I go through with stop losses and where to place them. I used to set them fairly tight and consequently got liquidated too many times, lesson learned (the hard way). And now I'm having a lot more success by giving stop losses more room to breath. So the focus on improving my risk management strategy is the thing for me these days.