If you saw my last analysis, my thought was that we would be breaking far below the trading range, which didn’t happen. Some solid clues to the bounce on the technical was that the second bottom (which we are now identifying as SOW) bounced on low …. Meaning, there was no intent by market maker to push further down.
The SOW (sign of weakness) in our Wyckoff trading range did not break below the trading range (which it does not technically have to for it to be a SOW).
You can see in that the was broken through at the top with pretty decent . We have retraced back towards the top of the flag and we are now starting to see low again on the retrace back to support, which usually indicates that price is ready to go up into upthrust and temporarily clear the range. This is a temporarily sign….. Again, this is a move meant to sucker in retail traders to think that upwards is still the overall and long term trend so key players can get rid of their bitcoin at much higher prices.
While it was in our favor to do a stop loss in our short position, we have to start realizing what is actually happening here. WHY price is going where it’s going. WHAT the objective is for market makers.
While you may get stopped out of your positions, this should be a very natural effect. You should not be weary of losing a little so that you can gain much more in the long term. Stop losses do not make you a bad trader, they make you an EFFECTIVE one because you have a clear understanding of where to cut small losses for the greater good. Eventually, this is a winning strategy.
The technicals are this:
Clear and pretty strong breakout of flag with decent . Price is retesting broken resistance. You will NOT always see price touch the top of the flag again, although this is not to say it wont or can’t.
We are seeing low on the retrace, which is indicative of a bounce. Based on that assumption, we can say that SOW may have likely happened and price is ready to jump further up to upthrust phase, which is basically market makers pushing price up higher so they can sell their bags for good profit before the rug gets pulled on retail.
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