bitcoin just hit a new All Time High. It hit our target of ~ $1214 a bit earlier than expected. While it is doubtful that this is going to be a long-term top, there are many warning signs telling traders to take money off the table and close some of their long positions.
Here is the long-term daily chart:
It just touched the top of the 4th square. That is a natural place one should be wary of tops. While the 5th arc pair (red, a bit higher) is a reasonable target, the top of square should not be ignored.
Here is a shorter-term setup on the same daily chart. This is a setup from the 750 low:
On this setup, we see that the 5th arc pair has been reached, AND we are at the end of square in time. Another huge warning sign.
Finally, here is an updated look at the 4 hour chart we looked at yesterday:
This was the chart we used to identify ~ $1214 as a target just yesterday. As you can see, price EXACTLY hit the top of the 5th square and backed off. It is resting at the 0.5 pitchfork line as these words are typed.
As you should be able to see, there are many reasons to close long positions here. In my opinion.
Aggressive traders might consider a short here. But if they do so, my advice is to make sure they have a stop loss not far above that 5th square. Because it is a very dangerous trade to short a bull rally like this one, obviously.
Happy trading!
Remember: The author is a trader who is subject to all manner of error in judgement. Do your own research, and be prepared to take full responsibility for your own trades.
Published at Fri, 24 Feb 2017 06:32:17 +0000
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