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Consensio: P < L MA < S MA < M MA | Watch out for death cross
Patterns: Phase 7 hyperwave |
Horizontals: R: $4,070 | S: $3,581
Parabolic SAR: $4,068
Curve: Backwardation with widening spread
BTCUSDSHORTS: Starting to pick back up
Funding Rates: Longs receive 0.1256%
TD’ Sequential: R3
Cloud: Price is fighting hard to reenter that cloud.
Index: Sticking below 50
Price Action: 24h: -0.4% | 2w: -5.9% | 1m: +5.5%
Bands: Starting to trend with price below MA
Oscillator: Quickly pulling back to oversold territory.
Summary: Very unimpressed with the reaction that we are seeing from horizontal support. I wanted to see an immediate response in order to be confident that the breakdown on Wednesday was a shakeout before a 50%+ dead cat bounce.
On the other hand I was watching for a close below yesterday’s low to provide final confirmation to exit longs and start scaling into shorts. Neither of those occured and that has me scratching my head.
closed a that never fell below yesterday’s lows and that could be viewed as bears running out of ammunition under $3,800. However the longer we stay below the 33 MA (currently at $3,715) the more confident I will be that bears are maintaining control.
If we hold here long enough for a death cross to occur then I will be moving very quickly into some short positions.
There are a couple reasons why I am remaining tentatively and considering adding to my long position after today’s close and that is the curve. Not only is it experiencing backwardation but the spread is increasing from 3% to 3.8% over the last 24 hours.
Generally I would stay out of the markets when the are this murky. However, I believe that the backwardation with a widening spread is a strong enough indicator in and of itself for me to act on. The risk:reward also favors bulls in this area.
Furthermore the funding rates have been very expensive over the past 24 hours for short sellers, about 10X the average. This is as important to me as the chart which is showing a lack of short selling. When funding rates are this expensive for shorts then it tells me that chart is not painting the full picture.
Published at Sat, 12 Jan 2019 01:02:07 +0000