At the time of posting this, Bitcoin is trading at $3,950. It's struggling to get back up to $4,000.
For noobs, that's no problem. You see, anyone new to Bitcoin or trading in general thinks that this is a get rich quick scheme. But it's not.
Originally, I wanted to post this on steemit, but it takes a few days to validate my account, so I decided to do it here. Ye olde archaic Blogger; Centralized, Not Anonymous, but hey, who cares. I wanted to share the idea and here goes.
So why am I shorting bitcoin? Well the answer in one word is "China!"
I mean, I don't know if you noticed, but the world's second biggest economy just pulled out of Bitcoin! They're still mining it, of course, and internet is so regulated there that it's not leaving the country. Nonetheless, people aren't allowed to buy it!
Technically speaking, I'm concerned as well.
You see, Bitcoin just hit a major resistance level:
If you're a bitcoin bull, you're probably saying to yourself, "so what!" I can draw trend lines too. That doesn't mean it can't break out!
But here's the problem. The volume cycle has just started. In fact, it's at an all time relative low. Let me show you what I mean by volume cycles:
As indicated by the red arrows, volume spikes in cycles. These aren't very symmetrical cycles, but nonetheless, they do give one a good idea of what's happening in terms of price.
Notice where we are now though. We're at the lowest volume since February!!! At the same time, we're trying to break out of a major downward resistance channel!!
This latest downward channel is WAY bigger than the one that started in June of this year. And look at the angle of it! It's an absolute monster!!
Let me give you a metaphor to illustrate what's happening right now. This is a bit like an ant trying to barge through a massive brick wall. On top of that, it's got no room for run-up. It doesn't have the power behind it to gain any speed! To all appearances, and barring a whale falling from the sky, it doesn't stand a chance!
Dumb Money Is Jumping in!
Additionally, have you noticed how many ads are talking about getting rich on Bitcoin and ICO's? If you hate those things as much as I do, perhaps you'd better follow the smart money and buy up at $3,100 or even as low as $2,150. Tone Vays, one of the technical analysts I look up to most, has said it may even go down to the next fib projection level at $1,750!
So don't say nobody told you! We're on the cusp of a major drop!
Opportunity Awaits
They say every cloud has a silver lining. The good news is, you can buy up Bitcoin when it drops, at the same price as it was MONTHS ago!
Or if you're already in, set your buy limit orders at those prices mentioned above!
Hope it helps!!!
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