In trading, it is tempting to tell an audience to do something, just as it is tempting to do something yourself. But in trading, doing nothing is never doing nothing. In fact, 90% of trading is patiently waiting.
Therefore, I am doing nothing. And in doing nothing, I preserve my capital, my sanity, and leave chart-chasing to the plebs.
We are in a DANGEROUS spot in Bitcoin 0.49% - dangerous, because it is tempting for us to do something, when the thing we ought to do is nothing.
The trading that takes place WITHIN the previous month's candle body - when the previous month's body is the climax of a multi-month parabola - is always going to be fraught with danger. Trading OUTSIDE the candle body is more prudent. There is the place from which to build conviction. Anything within the body is guessing.
There was a nice buy this week, at 9200 or so - the low of the previous month. If you bought the low, and still have the position open, that is not a bad place to be. But you should only consider danger to the downside to be averted if price closes January above December's close, at 14000.
If you're flat, like me, then you must take the same approach. Does that mean you blindly buy at 14000? No. It simply means that if price closes ABOVE 14k -2.38% on a monthly basis, you should look to buy dips.
Similarly, if price dips below 9200 on an intraday basis, you can also look for new long entries. This strategy is invalided if price CLOSES BELOW December's low on monthly basis. That would signify further downside and a fundamental change in fortune (unlikely).
For many, this analysis will seem clumsy and simplistic. But as we near the end of January, it will be important to see how this month's candle will turn out. If we remain inside December's candle body, we remain neutral - that is that.
The perfect buy point will occur somewhere within November's candle range. A panic to 8k, 7k or even 6k cannot be ruled out. On the other hand, we cannot rule out a close above 14k -2.38% before the end of January. Should this occur, your buy entry will be sometime in February, somewhere below 14k!
So, be patient. Relax. DO NOTHING.
