Hello Crypto Friends!

So BTC was unable to break the $7400 level. 

I exited my long positions for a small loss as i recognized it wasn't performing as i was expecting. You can't win 100% of trades and this is a key thing to recognize and learn quickly. The faster you can get out of your losing trades the more profit you will make in the long run. 

However i instantly flipped short at that point and was able to recover my losses. I have now exited my short positions though and this post is explaning why.

Firstly, I do not trust weekend price action. Friday was actually a public holiday start to a long weekend. Therefore i see this little drop in price we had as a potential trap!

Lets look at what every trader and his dog is watching-

This rising wedge. The volume profile matches the pattern, decreasing volume with rising price. However, the breakout of such patterns normally has an outbreak in volume which i don't see here. Yes the volume was a little higher than the previous couple of days but nothing to write home about.

Lets look at another pattern -

This ascending triangle, which took forever to break the key level of around $6850. These patterns generally can have a back test of the breakout level as confirmation. Well guess where the price is now?

Also lets check the EMA's-

Look left firstly. BTC spent 4 days testing the 21, to then get rejected, to finally break through it on the 5th. Then the 34 EMA was tested, then recently we were testing the 55. We got rejected, however the 21 EMA is now acting as support. It is normal as well for price to go and test an EMA cross, which the 13 and 21 just did.

Now, the chart that i have been watching recently because it has given the best trades is this one-

It shows we are still withing the rising channel, we got rejected on the first test to break the falling wedge. But i can see price coming right back up and breaking out with volume this coming week! The market is overly short right now and a push up to $7400 would trigger alot of stop losses and liquidations making the price shoot up with volume!

So i am currently sitting out of trades. Waiting to see what Monday brings. A close below the 21 EMA and i will probably take a short position. A close above the 13 EMA and i will going long.

Bears beware! This could be a trap!

Quick look at the 4hr-

On the RSI, we broke that rising trend line, however it is forming a falling wedge. Also in an accumulation red wave. And Money flow is not as low as it can go, and looking to create a divergence.

I would keep an eye on this, as we could see some explosive move up or down on Monday!

Happy Trading!