Topic: Bollinger: "BTCUSD is in a BB Squeeze, Awaiting confirmation of a move higher." (Read 446 times)

February this year is where I recognized a positive trend forming but it was still below the radar, too small and easily dismissed or ignored.   Thats the one I regret because the prices were nicer, March and April is the safer confirmation of that early recovery in BTC but prices already higher by then, we know obviously it was worth taking that buy.   So just like now theres the sharp end of the stick where it could be painful to buy but also greater gains.


Long term is the better perspective always to consider because it contains all the data, short term anything can happen.   I will argue there is alot of space or free air in the long term view for where we can be day to day and we can have a candle or pin far outside where people thought the boundary would be, especially when we are switching to weekly or monthly candles or moving averages, etc    
   Someone else said it on a video I watched but I totally agree, BTC always over runs both its positive and when its negative.    A move away from a tight formation is going be like an elastic band, I hope to catch some of the movement shorter term.
 
 So the BB shows 7350 as a possible price target on a weekly view.   Mostly a question as I not used BB for many years so I could easily consider it in the wrong way.

The daily Bollinger bands are already squeezing, but it seems like we're gearing up for an even bigger squeeze on the weekly chart. Here you can see the weekly BBs plotted against BB width to highlight the coiling that's occurring, just like in March this year:



In March, you can also see some tagging of the BB basis (the 20-week MA), very similar to the current price action. I expect October to play out similarly to April too.

That's for a descending triangle, also known as a "bearish triangle." So even bearish triangles break upwards a majority of the time.

Technically, the pattern on the chart is a symmetrical triangle. Bulkowski's backtesting says they break upward 60% of the time and he isn't even controlling for trend direction. If he did, I'm confident the numbers would be even better:

I meant to mention this site before which goes over various patterns and their percentage accuracy in confirming the pattern as significant.   I think BTC is especially hard to pin down as volume is distributed not centralised to mostly one exchange as is more common in FIAT bound quotes.

http://thepatternsite.com/TimePerformance.html

So it would seem it can break either way, only a slight bias to upwards.    We see the volume declining so that fits but the lows are slightly higher, yesterdays low was higher by a few hundred.

I wonder if that tag of the daily lower band is all we get! Bulls look to be closing the day pretty strong, nice reaction.

Bollinger calling it a head fake!


I don't want to get into a thing over it, but looking at the weekly chart there were 4 distinct runs at the low $200s or below. Per conventional wisdom, we should have crashed on the 3rd or 4th attempt......but we didn't.


We aren't making lower lows at all. Every low on the weekly chart since the initial July crash is a higher low. There may be a descending trend line but there's also an ascending one that's being respected.


Triangles tend to be continuation patterns, not tops. There is a huge and budding uptrend on the monthly chart. I don't see any reason to bet against it.

That situation was a bit different though. The price was bouncing between $200-$300 for almost a whole year, with more $300 touches than $200 based on Bitstamp's chart. Currently we're not hammering the same horizontal resistance level, but lower ones as the resistance descends further and further.

Another difference is that we back in 2015 were in the process of bottoming out with how exhausted the sellers were, while currently we might be in the process of topping out with how bearish the triangular formation is. On top of that, at current levels there are a lot of profits that haven't been taken yet, so I'm currently favoring a bearish outcome.

Eiter way, current volumes for Bitcoin are extremely low. Judging by the wicks up and down it seems that market movers have a great time toying around. I'm not going to take a trade unless we break in either up/down direction.

There are still lots of investors with large money awaiting to get that slightest chance to lodge in their money also, and they have actually been doing I gradually, I mean when they see a little opportunity for dip , they shocked it with part of what  they would have pumped in the market at once, and I think that they will pump a whole lot of money, the moment that they also get a clear direction off bitcoin, so there is still so much money that would be entering into the cryptocurrency market of bitcoin soon.

There is this bakkt that people has been talking about, and when I thoroughly studied it also, I found that it will be another catalyst for bitcoin price this period also, and i think right now is best to buy this bitcoin.

There's our dump to the mid-$9,000s! Not much to do but wait and see if this local bottom holds. By the look of the 4-hour candle, it won't. A run at the August bottom (yellow level in the chart above) looks likely. I'm still not confident we'll go any lower than the $9,100 area.

In the last bull market the longest duration between a swing high and swing low was 46 days.....we hit our swing high almost 90 days ago, so unless Bitcoin does something different, our swing low was in mid July when we hit $9100. A move lower than $9100 at this point would be breaking the trend of the last bull market. I would say at this point it is 95% chance we never go lower than $9100, and it is very likely we will break bullish soon, and start our ascent to breaking $13,900, perhaps in October or November, and potentially running up to $20k shortly after.

The chart looks to be getting to that boring period just before the next move upwards. Major bull market support is in the 10,000s now. the type of support that was never significantly broken through last bull market, so I doubt we'll see a big drop. A few hundred dollar drop is always possible. Anyway I'd bet my money on the now boring consolidation ending in October (maaaaybe even late september) and a new upswing commencing.

This bull market so far has looked A LOT like the last one. After a two-month double-jump upwards to close out 2015 the market went sideways for six months before the next big move up. This cycle we had a three-month triple-jump upwards (->5k, ->8k, ->13k) to start the bull market and now have been going sideways/consolidating for nearly three months. I'd say low possibility this sideways trend could continue for another 2-3 months, but I think it ending in roughly the next month is more likely. Very low possibility of any real downward movement from the 10k level. Think we'll see $18k+ before end of the year.

Whales aren't going to keep the price above $9k for ever--they'll run out of confidence and financial resources to support it, just like how sellers ran out of coins to sell between $3-$4k while people were expecting $2k to be hit.

I personally won't buy any satoshi until we dip below $9k, unless the price does what most people don't expect and pump instead, but even then, what I want to see is higher local highs where ~$12k is the first important target.

I favor the long term MAs over the short term any day. That's where we are now, sandwiched between the 20-week/200-day averages and the 20-day/50-day averages.

The shorter term bearishness doesn't look done yet. There will probably be residual downward pressure for a couple more weeks I'm guessing. I just think the downside is probably limited to the 20-week EMA area based on history. The lower symmetrical triangle boundary and the daily lower Bollinger Band add some additional support to that theory.

This is just moving averages for roughly the week and month, I cant see anywhere else its done this before recently anyhow.    Kinda eerie, perhaps the eye of the storm is on us.




I might be biased but sure I see the higher lows on daily bars but its a more slight incline and I dont feel this is the stronger identifiable trend of the two.    But yea there is some argument either way, I'd call it out as a descending triangle and some think its symmetrical perhaps.

I'd rather go off the 50 day which we left on the weekend and that is still rising but if 200 MA can beat 50 MA on 4hr I'll add some short to see if its going to move or not

Probably so. The mid-$9,000s are a good bet for the bottom. It keeps the weekly triangle intact and prevents triggering a downside BB squeeze. However a throwover below the trend line is also possible as David points out.

Best to have bids in place for both situations. If the throwover doesn't occur, be ready to switch gears and support the bottom and all dips moving forward.

Bears has been in sleep for a long long time, we have been seeing the bull run for the past 5 months now. Do not think for a second that when bitcoin moved from 3k to 10k the bull run stopped, right now even tho price is not moving there is really a bull move, not above but trying to keep it steady at these prices in face of people selling.

There are always tons of pressure to sell bitcoin and those sells have to be bought by someone so that price doesn't fall, if people stop buying those then people will start selling lower and lower to find buyers and right now we are way above those days because buyers actually take the hit and I find that a bull run as well because we have many people buying, as soon as we are more than the sellers or sellers stop then it will affect the price as well.

Bids initialized, ready and waiting sir. Although, the lower $9,000s might be blocked by the whale-cumulators by placing their bids to the mid-higher $9,000s.

gradually? i think their days ended last year on Dec 15, 2018 when price reached $3122 and they had nothing to say in this market any more from that day on. price has been constantly rising up ever since if you look at the longer term instead of daily charts with only certain periods of accumulation which could be referred to as the sideways periods. market has been officially in bull mode ever since that day.
all the subsequent drops we see are small and short term because of either corrections or some panic that are always resolved right away.

Breaking through $6K so easily was extremely bullish, suggestive of exhausted supply and overwhelming demand. I don't see any reason to assume the same thing would happen in reverse.

Anything is possible though. So I'm open to that scenario but it would probably mean the end of the bull market. I agree with xxxx123abcxxxx here (in fact anything beyond the 78.6% level spells failure to me) about the "faltering bull market":


For me, the first signal would be a monthly close below the 20 EMA. In 2014 and 2018 that was a clear indication of bear market conditions. I'm betting that won't happen based on the previous bull cycles.


Looking at the weekly candles, we've only tested it twice. One more would be typical of a triangle. I agree with you that repeatedly hammering support often suggests an eventual breakdown, but it's not a hard rule either. The $200 area in 2015 is one example where that thinking failed.

Just as surprising as we broke through the $6000 level effortlessly? I'm open to the idea of a few stormy weeks below $6000 in the "worst case scenario".

Another test? How many horizontal support tests does one need? The more often we test the lower $9000's the more likely it is that it breaks. I don't see anything bullish in yet another test because all it does is expose how the bears dominate the trend.

I'm confident that the actual 'tree shake' will be more brutal than people here think it will be.

doesn't that argument go both ways? price is in a contracting range because attempts to break out are failing in both directions. the bulls look weak because of the lower highs, but the bears look weak because of the higher lows.

on the weekly time frame, it looks like a pretty obvious "bullish pennant" to me. why would that be bearish? let's compare---

Day of the bears growing weaker is not something I see on the chart, it seems to be a scenario where each rise is lesser then the last attempt.   So the Bollinger bands are constricting and we are above the average so if people say we are bullish then fair enough but the range is constricted and there is less scope for any leveraged bet upwards to be justified in being placed.      Traders want the large movements and if thats not there then we have less speculative money entering perhaps, its then going to fall on the fundamental money to back the price or not.
   I dont think slimmer BB has to be bullish but I dont normally use them tbh or see them being used by people I watch.



Not been in a trend since June, I think the first example is more reliable and BB is most often a boundary play.

The way I understand Bollinger bands as an indicator is that the more narrower the bands get the higher probability it will go up. In this case if we follow the idea that it will go down back to the 9,000$ level I don't think we can consider that a squeeze if that happens BTC should at least be trading around the levels near the 10,000$ area a 10% difference on prices cannot be consider near. So if you expect that will be revisiting the 9,000$ area then we can expect that this breakout won't happen anytime soon.

I always try to keep an open mind to prevent getting married to trading positions.

Ultimately I still see room down to the $7K area, where this orange 20-month EMA is. I would be pretty surprised to break below the June monthly pivot at $7,432 (Bitstamp) though:



More likely, we'll just retest the low $9,000s one more time like you said. I have a feeling we still need to shake the trees but that's probably it.

Without even using the chart, I know that the day of the bears is gradually getting over, I mean that the little bears that has been pulling the market down every time that we always head up for recovery ever since we saw that $13800. If the price plunge low to $9000 again, I think this might just be the last we will see of that $9000 and we may have to take it as an opportunity for those who has been skeptical about making investment to make it right now before there is another surge that would make it impossible for them to buy again.

The thing I just know is that there is possibility of bitcoin heading for $15000 before the end of the year and if that is going to be the case, then it is certain that the market will head for a bull run at early next year.

I love when John Bollinger tells us to pay attention. It usually pays off. He's talking about the daily Bollinger bands:


You can see the current BB width here compared to the daily squeezes in April, May, and June (green arrows):



There's a couple other things on that chart to note. Shorts have risen considerably from the lows. Not quite as high as I'd like to see them but we're getting there. We might need a few more weeks of chopping to build up shorts and scare out longs.

Finally, the red arrow on the chart: be prepared for a head fake. Long sideways formations like triangles sometimes like to throw over in the opposite direction before breaking out. So we might see a plunge to the low $9Ks again before finally breaking upwards.