Daily Report – Bitcoin and Market Update (July 28 2021)
The weekly candle is obviously not closed just yet while with this chart I aim to present my unchanged thoughts about where BTC is going in Q4 later this year. We’re missing 5th Elliot Wave of this bull run, which you already know. Beautiful full market reset we’ve seen recently per completing 50-week mean reversion, perfect reset of trend & momentum from Birbicator in the oversold area unseen ever since BTCUSD was trading at 3-6k levels. IMO we’re getting ready for the final leg up in Q3 in some form of a massive chart pattern consolidation (BTC likes triangles) to launch final euphoria climax with NUPL >> 0.75 into 90-120k region confirmed by 1-1.618 Fibonacci extension – potential overthrow over 130k.
I’ve managed to experience enough bull and bear markets with high timeframe reversal predictions months in advance (overall that’s why I became popular on twitter) to know that the scenario given is not impossible at all.
Yesterday’s daily closed as a very strong candle inside an area of range highs of the 70+ day long range 30-43k, which means it showed strength where it showed weakness before. It’s a bullish sign and early warning for bears trying to short the range highs about potential upcoming breakout in the upwards direction.
Overall, the daily picture looks like it’s going to approach 42.2-44.6k supply region based on aVWAP + MA200 resistance cluster. Daily support sits at 34-34.7k while it’s technically tight and strong. I could see these very levels getting retested only from unpredicted news-driven declines because of FED’s FUD about hiking interest rates, which would make the global markets risk off with strengthening dollar DXY. Their goal is to limit the growth of commodities, especially gold. It’s nothing new about it and it’s not in central banks interest to see expensive gold.
The other bearish volatility may come as we ride into the weekend as Friday 30th is when CME futures, options are expiring. Derivatives expiring mean Open Interest decline and Volume boost, which would come with enhanced volatility (and risk).
Close a day or week through 42.2-44.6k supply with a strong candle and 53-58k volume-based supply cluster opens for BTCUSD
Long story short: A 12h candle close inside VWAP resistance cluster 40-42.6k with a daily close over 40k, would suggest continuation to at least 42.6k. As long as Breaker High 35088 stays defended, R3 50426 is on the table. BPRO flashed buy at 31.6k and Ive been fully loaded ever since.
Locally, if we keep failing to close a day over 40k, it brings more risk to retest low 35-36k region. Worth having some MTF bids there.
As MTF picture is approaching the very range highs territory of past 70+ day long sideways pattern, it is worth reminding that most of MTF swing trades do best if they buy breakout (or better breakout retest) of 43k range highs. Currently Im seeing two probable scenarios: The orange one shows a technical concept of BTCUSD price action if undisturbed by some unpredicted, external FUD news – local triangle/rectangle/pennant consolidation followed by an upside breakout towards R1 44567. The second scenario presents potential result of a news-driven market decline from FED’s FUD about interest rate hikes today combined with Fridays CME derivatives expiry and volatility.
As long as we keep closing candles over the Breaker High 36832, bulls are completely safe and aiming for 44567.
We must not close a day/week below Breaker Low 30354.
Locally, BPRO suggests BTCUSD is tiny bit overbought which brings higher chances of local range between 37k lows and 40k highs. Main supports locally are baseline at 37k and 35.5k BWAP.
Volatility bands suggest it is most likely we will see BTCUSD trading between 32.5k and 42k in the upcoming days/weeks.
Hourly picture is quite simple case to analyze. It presents clean volume based clusters for the supports in case of mild or more severe news-driven declines. PoC + VWAP 37.8-38.3k suport area confirmed by MA50 and low 34000s – volume spike + MA200. If BTCUSD does not get disturbed by unpredicted events, FUD news, it should therefore form a symmetric triangle / pennant with a local decline towards 38k support followed by an upside breakout over the pattern, aiming for 43-44k region.
The index started finally showing how crowds are slowly starting to believe the bottom is in and that those who sold extreme fear spikes below 30k (exactly when I announced adding $300k to long term holdings and buy suggestions shared for exclusive members). The retail extreme bears aiming for $10k btc targets have either disappeared from the market as they got liquidated (1bn in short liquidations on the short squeeze day), or they have started thinking of buying now (right as we approached resistance, obviously). That’s what I read out of the yesterdays index spike to 50 points and neutrality. Crowds have just become neutral as they’re starting to realize it was a mistake to sell off low 30000s:)
NUPL currently at 0.5 ratio entering back the typical belief stage of the market, which seems to be well aligned with my overall thoughts shared with the charts above. I still claim we’re in similar pattern to what we saw during April-November 2017 preparations for final leg up of the market. No divergences spotted so far as opposed to the large divergence NUPL vs PA seen around 65k highs. I’ve been claiming that onchain data suggests we have perfectly reset the market to the levels of disbelief September 2020. This would align with the overall concept of 5th Elliot Wave / final leg up as the market has cleared the momentum and allowed it to regain the bullish potential in the past 70+ days of range.
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