Dear Traders,
Today is the 20th January 2021, let’s get another market update released, and talk about some of the recent moves we have seen across the board. I hope this newsletter helps to explain in more detail my current bias for PA and where I think we could be heading over the coming days, weeks, and months!
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Good morning everyone I wanted to take a look quickly at the market, especially ETH right now just so that everyone is updated on what I am currently looking at. If we take a look at the lower timeframes for ETH we can see that price action is actually looking really impressive, we broke out from this formation with some nice volume, and now when price is retesting the previous highs when BTC is pulling back a few %, ETH seems to be holding up very well. The previous high was around $1350, so this is a really important level if you are looking to make intraday trades, price needs to hold this level as support, and any substantial close below on something like the 4H+ or would be pretty nasty and we could see a retest back down to around $1250 region.
Right now, the most important thing is just keeping the momentum strong on the LTF’s seeing strong candle closes and just ranging here for the next few days. I think a lot of traders or investors might be more cautious here due to it being around ATH levels but like we have seen previously with BTC, once this level truly does get broken with conviction there will be no stopping the momentum. Next targets would be $1600 and then $2000. I think momentum is still bullish right now and I want would be looking for some bearish weekly and daily close to change my opinion on that.
Just looking at the daily chart that is above, this would be awfully bullish for a daily candle and I would add to my long position if we end up seeing a daily close such as this. Daily close just like LTF momentum needs to be above $1350 level.
Looking at the weekly level, I still think I would like to see PA trade above the previous ATH at the weekly close, closing below it could hinder some of our upside momentum but as long as the weekly close is above or around $135//1400 we would be looking good for continuation to the upside. I think the overall market structure for ETH is still heavily bullish in the macro and being at ATH region and ranging is super bullish for PA. Let’s continue to see how the daily and weekly candles start closing…
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In terms of BTC and some updates on current price action, I think the most important thing right now is to focus on HTF levels for where price could start to target next and where is a sensible place to put some bids if you're looking to refill an entry lower. At this moment in time, in terms of targets, the obvious goal is $38,000/$40,000 somewhere between that region and this is where I would want price to test possibly before the end of this month. In terms of support, looking at the chart that is below, it's pretty obvious that most of our HTF macro support is this $30,000 level which both collects support and buyers from a fib support level and a gann fan support level.
Currently, in my personal opinion, BTC is a lot harder to trade and predict, currently just seems as though it is ranging between $34,000/36,000 and just hurting positions on both sides by large wicks and volatility. It also seems pretty regular now to see 1/2% plunges or spikes with BTC so personally, I’m not trading any leverage at the moment, I think spot positions are much more sustainable in this market and still can give amazing returns if you get well-positioned bids filled. At the moment $30,000 is the area you want to get filled at (if lucky), as mentioned previously there is a lot of support in this region in terms of the macrostructure and I think also looking at the order book this is where a lot of larger sized positions would step in to defend price action.
In terms of LTF momentum for BTC, I would expect to see buyers step in around the lower end of $42,000’s region as this region has previously been the lows as we have been ranging over the past few days. If buyers do not step in here to try and attempt to defend against sellers then I guess the likely next support would be $33,300 or $32,000 at the very lowest in terms of LTF. I personally think we need to see how the 4H and daily closes to see if this downward motion has any real strength or if this is just another attempt to put pressure on high leveraged longs and squeeze. Time will tell but these are the levels I am watching at this moment in time. Hourly closes need to maintain above $34,200 to keep us wicking down lower.
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