Daily Report – Bitcoin and Market Update (October 9 2021)
The middaily chart is looking really solid so far as it’s consolidating right after major breakout day where some whale entity market bought (FOMO) 1.6B USD worth of bitcoin at 51000s. Bitcoin resists to even touch the prior resistance at 53k and so far has turned it successfully into support based on polarity change principle. This is bullish consolidation by the looks of it and unless unexpected FUD news comes out, BTCUSD is set to test the 58-65k highs in the next few days.
50-week average provides very strong support for BTCUSD at 40k and in case of a minor black swan I could see that working as a final bullish bastion or it would keep retracing deeper into mid 30000s – personally I think it’s unlikely but there’s always a risk included and we’re late in the cycle.
Volume based averages point at 42.5-44.4k to be of strong demand with clear bullish tendencies marked in the chart ever since the bullish crossover in late August – I explained the importance of this bullish cross in late August and how it marked the new uptrend to following. Local breakout leg suggests that aVWAP support is at 50112 so any short-term deviations caused by a fakeout or rapid selloff out of nowhere would likely make bitcoin slide down towards this support.
Price action wise, the breakout day brought another bullish confirmation with bitcoin making higher high after making higher low at 39.6k on 21st of September. It’s a major bullish signal which should lead bitcoin to the new ATH – something I’d also explained so many times in the reports here, video reports, interviews and webinars. It’s simply bullish.
MTF chart is showing quite a few lower-timeframe confirmations behind my 12h chart comments. The old supply zone 50-53k is now reclaimed and works as a new demand zone to reload short-term longs as long as BTC trades at its local volume shelf support 53.5k. It’s local sideways with consolidation which I read as a bullish breakout retest in a form of a pennant or a flag. Those half-mast formations usually come after massive breakout sessions like the one we had on the whale fomoing in with 1.6B usd market buys.
For short-term, the only point Id be cautious about longing in here (although Id have no idea how you might have missed my two bottom long calls at 30k and 40k) Is the fact that bitcoin fails to close 4h or 1d candles through 55.3k. Instead, it keeps printing local fakeouts with candle shadows showing liquidity grabs over this 55.3k level. Worst case I technically read out of it is local throwback to 52-53k but even that is not a necessity to my mind.
Volume based supports beneath the new demand zone are 47.5k, 46k and 43k in case of unexpected FUD event.
The next bitcoin’s resistances are 58k, 60k, 65k. Technically speaking, bitcoin already has a clear sky above to rally to new ATH because of long-term trendline breakout confirming the weekly triangle concept I’d been giving since June 2021.
In other words, bitcoin is technically set for new ATH and only forced FUD events can disrupt its LTF-MTF bullishness.
Hourly chart is giving insights into local consolidation period after the massive breakout day. Volume supports bitcoin at 54k, 52.5k and 51.5k in case of the top fakeout coming to action. As said this tiny innocent fakeout into 56k is not anything overly dangerous or too much of worry imo. The way I interpret it is that it may slightly extend the consolidation and perhaps take bitcoin down to 52.5k or 51.5k (less likely) in case of a rapid breakdown selloff – which would not make a lot of sense imo.
The breakout day with 5k upwards candle of market buying looks as if somebody had wanted to help bitcoin finally break out above its resistances in a way that BTCUSD was ready but all it needed was “a little push”. Some whale funds flowed in to actually give it the kick and the little push. This was not really needed as bitcoin would have managed to break out eventually anyway. It just accelerated the breakout and made it come faster.
The local consolidation, which I read as bullish sideways pattern, could see a further bitcoin’s rally into 58-60k the moment that we see first successful 1h or 4h close through the range highs 56k.
After recent “divergence” as I called it where NUPL was lagging behind the price’s breakout, now we’ve seen NUPL catching up after the price and providing equilibrium inside the market between onchain and price action. The market is neutral and equal based on onchain and price analysis. It’s just healthy.
NUPL ratio at ~ 0.599 is signaling bullishness of bitcoin’s onchain as the market’s gone into belief mode. It’s nowhere near the toppy values. Kind reminder that bitcoin is set to launch the “topping process” the moment that it enters NUPL>0.75 territory. When its there, it may take a few weeks and 50-100% ROI growth so NUPL doesnt necessarily tell you about the price peaks but rather about the time that market will peak within. It’s a time signal to time the entry regardless the price.
Now that the 40k bears are rekt, liquidated and wiped out of the market, the remaining part of the herds are catching up realizing they were wrong so the sentiment has improved per the index value.
Now at 72 points the market is within it’s greed or extreme greed mode. The best of it all is, that ON THE CONTRARY to what we saw of extreme fear on September 21st, now I read it more as a confirmation than a warning. It is both at once but the confirmation effect is stronger here.
Bitcoin can remain within the zone of extreme fear or extreme greed for days, weeks or even months (remember 80-day long extreme fear period at 30k?) and it doesnt need to mean the peak is near.
To be able to properly use FEAR/GREED INDEX as an indicator, one always needs to realize the bigger picture for the market technicals. The big picture is clear for the final 5th wave leg up and last stage of the bull market before it peaks. BUT, we are nowhere near the peak. We havent even broken the old ATH yet and yet bitcoin’s bullishness is growing.
Not having seen the final euphoria, mainstream mania phase, tech giants like Apple, Google, Microsoft, Amazon, Alibaba, etc accepting bitcoin and crypto payments, this is yet to come. We’re missing a few puzzles to complete the puzzle so sorry to disappoint bears – the bull market is NOT over. The greed indication suggests it’s wise to take some profits off the table after 40->56k rally. Of course it is worth it and for anybody who followed my bitcoin long exclusive call at 40k, TP1 at 52000s has already been reached successfully.
Conclusion is that it’s worth locking in some profits but the final mania phase is yet to come. This will align well with NUPL over 0.75. It’s always better to use FEAR/GREED INDEX readings in combination with technical analysis and other market readings. If one violates this basic rule, they may over interpret and wrongly read the greed at 72 points as the peak time. This couldnt be further from the truth.
For anybody who missed my yesterday’s premium webinar, make sure you catch up asap before it’s too late – link below. God bless yall.