Where it looked like it was the yellow circle, it eventually became the lower one. Like anyone can make any sense out of this low sideways sh.t show :). It is clear, this are all correctional moves, just difficult to pinpoint if it is from the moves down (meaning after correction dropping more) or if it is the bigger picture from the right, meaning all the moves from the 4200 has been one big correctional move (wave B) before we start wave C again.
Correctional moves are always the most confusing ones, also where traders tend to loose most of their trading capital again, because the moves are extremely random most of the time. So what a trader should do during moments like this are:
1) Reduce the sizes significantly. The big wins should be chased during impulse waves, the correctional ones should only be small wins so the losses are also small.
2) Simply sit on your hands, don’t trade at all and only do swing trades. So smaller sizes with wide stops. For example, getting in here with a short, but a stop around 3750. Or a long here with a stop around 3300.
3) Trading during sideways action, needs opposite thinking. Meaning, you should actually do the opposite of what you normally do. Meaning sometimes, go long when a certain level breaks (instead of going short) and vice versa.
Anyway, it looks like that has been completed now. We had a small yesterday, where we broke upwards from. But instead of holding the level, it simply dropped again and even below the breakout level. Assuming the trend is down, it could mean we could drop some more the coming days. The only thing i am looking for, is seeing a drop to the 3450/3300 zone and if i start to see some support there in combo with other signs, i might go long again.
Other 2 options i have in mind are:
1) Seeing a big dump and breaking supports, meaning the market will probably go into crash mode again. Like i described a bit in the ETH’ analysis.
2) We keep on moving sideways like this for another week or 2, inside the 3450/3750 zone and eventually breaking up.
Just too many mixed signal still. Some alts look while others look very weak. The low suggest, that either the market is dead again, like in the 6K zone, or big buyers are waiting for lower prices again to get in. So unfortunately, we have to be patient a while longer before being able to really choose a direction with some confidence.
Please don’t forget to like if you appreciate this 🙂
Previous analysis:
Published at Sat, 26 Jan 2019 17:05:44 +0000
