Welcome Everyone to the Seventh Chronicles DOSE!! 💸

This is a Weekly newsletter aimed for you to receive comprehensive weekly analysis, research reports, and actionable trade ideas covering traditional and crypto markets.

Every week feels like a year in crypto markets with so much to share and catch up on. I hope you find value in these newsletters and add them to your trading regime to maximise your profits! Enjoy!!

The TLDR; 👀

• BTC and ETH struggle at resistance after a flash crash caused by last week’s liquidations. 📉

• Sentiment holds Greed levels at 70 however has still yet to breach into Extreme Greed territory above 80. 🧠

  Consolidation in BTC is providing short-term opportunities in Altcoins. Explore some tips on how to best trade during these conditions! 🎯

Market Sentiment 🧠

The current market sentiment is sitting in the Greed region between 65-71 levels. There was a false breakout higher earlier in the week which caused Greed to spike above 71 briefly, however, it was a fake out move and cascading liquidations caused BTC to fall and sentiment went into consolidation alongside price.

I’m surprised Sentiment didn’t spike into Extreme Greed territory on the move above $45,000. There was enough time sustained above to allow Sentiment to spike and we may get the chance again if we see a bullish move off an ETF approval which can push BTC all the way up to $48,000 and higher.

We are currently in the “Thrill/Euphoria” phase of this new mini Market Cycle that started last year, and in the “Disbelief” phase of the longer term secular bullish market cycle. This is a slow moving indicator, and may not change week to week.

This indicates to me that the trend is almost ready to correct and continue the longer term accumulation trend into the halving, since we have seen a false breakout move higher and formation of a Wyckoff Distribution Pattern, it’s possible the short-term top is in if we see an ETF rejection and BTC falls into a bearish short term trend. We will have to wait and see what happens with the ETF news. 💰

Bitcoin Weekly Breakdown

BTC started the trading week at $44,232 and pushed to new recent highs at $45,945 before we saw a massive liquidation move and a flash crash in BTC and Alts to $40,625 the following day. This was caused by levered positions and the “domino effect” playing out where a few large traders got liquidated, which resulted in a spiral of lower prices as more traders had their positions forced closed at lower and lower prices.

This effectively created a potential “spring” or “fakeout” move above $45,000 and doesn’t confirm a breakout of resistance. Since the flash crash, BTC has recovered some ground and continues to hold the D20 (grey) as a dynamic support level which if held can provide further tests higher back up to $45,700 and levels that were met before the flash crash occurred.

Bitcoin right now is trading in lock to its ETF expectations. If there is approval, I expect an immediate rally to $48,000 and higher before sellers start to become more active. However, a pause or a rejection can see BTC visit back down to $41,280 and eventually break down the Wyckoff Distribution top which can see lower prices below $40,000.

Right now, the ETF news is the most important fundamental at play and will dictate where BTC ends up over the next couple of months.

Ethereum Weekly Breakdown

Ethereum right now is following BTC however is looking considerably weaker as traders are playing the ETF news with BTC and there are no fundamental catalysts for traders to get positioned in ETH so far.

Ether started the week at $2,365 and rallied to $2,432 before falling to $2,100 when BTC saw its flash crash after the false breakout move. Since then, Ether has rallied to $2,298 however is seeing continued selling pressure and isn’t capable of holding its D20 (grey) and struggling to stay above its D50 (red).

I’m surprised traders aren’t buying into ETH/BTC at major HTF support. It sees rallies in the short term but it immediately met with sellers and can’t find momentum to breakout and take ETHUSD much higher. Traders are laser-focused on the BTC ETF news and aren’t paying any attention to Ether.

The major pivot points for momentum is above $2,400 and ETH/BTC sees a sustained breakout. Otherwise, I have no interest in trading ETH long and will wait and see if the range lows at $2,120 are held before shorting for the longer-term move.

Patience is required when trading Ether and must need BTC to confirm the breakout before any short term trades can be taken to capture Ethers volatility.

My main goal this week is to be patient and wait for BTC to confirm a breakout. Then catch the Ethereum breakout and make BTC Value as capital flows into more high risk Altcoins.

Trading Tips for Choppy Conditions 💸👀

Market conditions have changed slightly since the false breakout above $45,000. We’re no longer getting follow-through in moves and traders are becoming more cautious of holding positions and being confident in the moves. This change causes choppy and indecisive conditions which with the right trading and risk management strategies can provide nice returns while the market trades sideways.

#1 Always have a plan for fakeouts.

Traders during choppy conditions are indecisive. When there are breakout opportunities, traders are more likely to close and exit positions and trade defensively rather than buying more at higher prices and making decisions based on Greed. Use tight stops to lock in profits early and observe price action during breakouts to confirm whether traders are confident in the breakout and push prices higher or whether prices are more likely to reverse back to pre-breakout levels.

#2 Watch coins breaking out against the majors as opportunities to fade.

If Altcoins are pushing to new recent highs/lows and BTC or ETH are showing signs of consolidation/low volatility, this can be seen as an opportunity to fade the move in the Altcoin. Typically, when BTC and ETH are consolidating. Traders look and chase volatility in other areas and this opens them up to be vulnerable to pump/dump schemes by larger traders and whales.

When you see projects rally +10% +20%+ on the back of no fundamentals while BTC and ETH are trading sideways. Observe price action and attempt to fade the move with low-risk positions. These are simply bonus moves to catch and are not designed to make a massive difference to one’s portfolio.

#3 Be careful with pushing targets. Don’t be Greedy.

During consistent bull trends, where breakouts rarely fail and price continues pushing to new highs after new highs. It’s easy to use a Trailing Stop Loss and let the market run your positions higher until full targets are met.

When times are choppy/inconsistent, there is still volatility to capture however there is a lack of follow-through if you were to use Trailing Stops/Wide Stop Losses. You’d give back the majority of your gains when the market wicks against you. The goal is to set conservative Take Profit targets and scale out of positions earlier than you expect and slowly with many Take Profit orders. This way, you’re taking gains out every step of the way the market moves in your favor and still leaving some of the position on if the market wicks to your full target.

I hope you all found these tips useful and you can be more confident to trade and make decisions during these choppy market conditions! Start small, and move higher from there!

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That’s a Wrap for this Week! 🌯

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