Daily Report – Bitcoin and Market Update (July 12 2021)
Weekly session with another close over 34.3k confirming that any trading below 34.3k in past 2 months has been eventually filled with buyers more than sellers. Price trades over the near-length baseline as well which brings some hope to the bulls. The major concern obviously is that BTCUSD keeps rejecting 39k+ levels consistently. As long as bitcoin does not see weekly close over 39k (lower BVWAP trendline + BWAP resistance), bulls are in trouble with further downside potential. Breaker Low 29511 is the most essential support on the map right now in my opinion. Should this level get broken with weekly close under, S1 23313 may come as the next medium-term target. As long as 29511 is defended, MTF picture is “safe” for bulls.
Daily chart displayed with BPRO momentum waves suggest similar confirmation to what we read in other approaches – volatility, trend, volume. The selling momentum keeps decreasing on average since mid June. While price action continues trading inside the clueless range, the two main levels that traders should pay the most attention to locally are: Momentum-based support (lower red arrow) 31.5k Momentum-based resistance (upper red arrow) 38.5k The market’s volatility has decreased substantially signaling upcoming volatility spike. The volatility is directionless and does not refer to any specific direction, especially inside range. It means that there’s going to be both side risks included. The price impulse which usually comes after less volatile periods is expected to cause a lot of liquidations on the futures market, stopping out traders who are over leveraged on both ends. It is hence NOT suggested to trade any leverage throughout the next days until bitcoin finds its own direction. Similarly to what 1W picture displays, Breaker Low 29808 is the key level to hold for bulls. Once weekly closes below, S1 23839 is on the table.
The middaily chart continues with clueless choppy price action inside consolidating volatility range. As BPRO volatility bands suggest, 30.3-35.5k are the main short-range boundaries. Confirmed breakout (daily/weekly close) outside these levels would lead to either 28.7k or 37.3k, which could eventually expand towards 23-24k decline or 40k+ levels and further upside recovery. BPRO is on the bearish mode yet remember it’s still a choppy clueless movement with tiniest volatility unseen for months where every sudden news from FED or tweet from Elon Musk may cause a cascade liquidation on the market. Breaker High at 44349 suggests that once this level is reclaimed by bulls with weekly close over that region, R3 51137 should come next. Unless that happens and if bulls lose Breaker Low 31554 (daily/weekly close below) then 26-28k levels should be watched.
MTF chart shows nothing but uncertainty on the market. What is worth highlighting is the fact of how flat BVWAP trendlines have been for past 3 weeks. It’s very rare to see this kind of low volatility so that the volume based averages are completely flat. It only proves how significant 34.2-34.7k zone is. It suggests that once this zone is reclaimed by bulls with daily/weekly close over 34782 Breaker High level, there should be a very sharp upside reaction with 20-30% spikes. Otherwise, if Breaker Low 31419 is lost with weekly close below, then it puts lower targets on the table with 23-24k floor as HTF analysis suggests. Again, it is not suggested to trade the range other than: 1. Buying range lows 28-30k 2. Selling range highs (40-43k) 3. Buying breakout RETEST over 43k 4. Selling breakdown RETEST below 30k That being said, do avoid using high leverage through the next days-weeks.
Hourly picture with BPRO long-length trend settings display 33.7-33.8k to be the main resistance area locally which if not broken to the upside, may result in further slow bleed towards volatility-based demand block 29.4k-31k. If 33.8k is reclaimed with daily close over that level, volatility-based supply 36.5-38.3k would be the next target zone. As one can see, BTCUSD chart is completely flat. It’s NOT trending. Therefore, it’s not suggested to over trade this clueless area full of uncertainty. The market is still in PTSD period and taking long time to recover from the May 18th crash. Any kind of bullish/bearish news would cause massive liquidations across the futures market and then cause the main impulse in either direction. For this reason, there are high chances that such a news would actually come sooner than later and depending on the bullishness/bearishness of the news, the cascade liquidations could lead towards either 23-24k floor or 40-43k supply region. Currently, BTC is in the middle of nowhere, inside the larger middle or nowhere which is part of even larger middle of nowhere. It is suggested for the vast majority, to mainly stand by as there are no technical reasons to be heavily active in this market right now. Otherwise, it would prove one is a gambler who does not care about any risks just for the sake of being in the position.
As displayed in the chart, currently we’re experiencing 60-day long extreme fear period which is extremely rare in this market. In fact, even 2018 bear market depression was of better sentiment than currently. It is unprecedented event. Historically, extreme fear has always been good buying opportunity where average ROI should be positive after some time. Do NOT confuse this with guessing the bottom. FEAR/GREED INDEX does not tell you where the bottom is – it may easily drop to 23-24k as mentioned earlier in the report. Instead, it suggests that practically any purchase of bitcoin in the past 60 days should provide you with positive ROI and good returns in the next few months based on historical records.
NET REALIZED PROFIT/LOSS
As glassnode defines, Net Realized Profit/Loss is the net profit or loss of all moved coins, and is defined by the difference of Realized Profit – Realized Loss. It suggests that current market shows the exact opposite state of what BTCUSD saw in February-May 43-65k range, especially over 58k. It does suggest massive liquidations could be labelled as some sort of market capitulation from over leveraged, weak hand retail traders.
Bitcoin: Realized Loss It is clear to see the capitulation on the realized loss spikes. These were not just some local selloffs, but rather two subsequent cascade capitulations. While referring to these spikes as capitulations, this onchain metric does not try to guess the bottom. It does not say 23-24k news-driven round #3 capitulation may not happen. Similarly to fear/greed index, it does refer instead to the historical profitability of traders buying into capitulations – wherever on the price chart these occur. No matter if bought 30k, 28.8k capitulations or potential 23-24k capitulation (mind the condition: 1W close < 29.5k), you should become very profitable in the next months. More details available only to the exclusive members inside #📺・nc-video-report channel in my video report.
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