We have a potential market recovery underway and Bitcoin is leading the market and starting to look much more bullish now for several reasons.
10ema crossed above 20ema AND the price is above both on the daily timeframe = BULLISH
The main support for BTC is at $78,470, the price fell below this level for a bearish trap and closed back above = BULLISH
A lot of buyers entered with volume at the minimum values to push the price above this support = BULLISH
How I approach this trading opportunity:
I am entering a long position at any price near $89,200 on the daily timeframe.
I am entering only with 10% of my portfolio. (So $100,000 portfolio - $10,000 position)
We will need to see continuation the following day - Increasing volume on both days.
I DO NOT want to see the price exceed $89,200 and then close below this level the following day.
I am keeping a tight stop at $84,400 to $83,800, which will likely be a loss of 7-8% on my pilot position. That is less than 1% of my total portfolio.
If my stop loss is hit, I will likely go short on new lows on BTC down to $71,500 - $62,500
If this is truly the beginning of a new upward trend, our bullish market zone on Bitcoin will be above $95,000.
If my first trade goes my way and Bitcoin increases, I will increase my position with more of my portfolio, about 10-15% more.
NOTE: All altcoins are likely to follow Bitcoin and trade higher, as many are significantly oversold. However, they are lagging now (or not increasing as much as Bitcoin). This is my signal to take much smaller positions on most altcoins and only bet on stronger performance.
NEVERTHELESS, the path of least resistance is now DOWN, as we are still technically in an intermediate downtrend since January 20, 2025. So be cautious and practice good risk management. Avoid leveraged trading if you have not yet mastered the basics of the chart. I still think we will go down, but with these signals I have to remain agnostic and do what the charts tell me.
Happy trading!