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INTERVIEW: HUSSLIN_
The former tradfi market maker and investment banker talks the pain of losing, relentless curiosity and shorting $69k for the culture.
JIM TALBOT: THE PATIENCE MINDSET
A few weeks ago I mentioned that the volume transacted in the range between $21,200 and $22,800 from the 9th-13th of September was significant and had all the properties of being a move to generate an exit. Well, skip forward a few weeks and we are testing the underside of that level now.
How does it look?
Well, the RSI on the 6H all the way up to the daily doesn’t look convincing. Momentum is dropping off so one would expect at least a pullback. I think initially, a pullback to $19,850 is likely as the current low is exactly $20,000 on Coinbase which is incredibly unlikely to be the low.
Momentum is dropping off so one would expect at least a pullback.
What has likely happened is that it tagged a large limit order there and bounced without filling causing a nice round, even number. These almost always get swept. I think you would be hard pushed to find a time one didn't.
I’m happy to potentially take a long in that $19,850 region depending on the reaction, as invalidation is basically the same price. I think a sweep into $21,200 from that level is a potential opportunity.
Overall though, I'm not convinced of this move. Structurally from an orderflow standpoint, it's very similar to every other significant bounce we have had recently. Noteworthy increase in open interest. Derivatives leading and not the level of short unwinding you want to see.
Derivatives leading and not the level of short unwinding you want to see.
I have said it before, but I much prefer to see price moving up on less volume and OI with more shorts getting squeezed as it indicates a lack of real supply which means it's much easier to move price with less effort. A couple of billion should have way more impact on price than it is doing currently, indicating there are still passive sellers in the market happy to fill limit asks at these prices.
I’ll also leave you with a stat that most false breakouts fail at around the 12 to 15% mark.
-Jim