June 1st 2019, Crypto Chartbook

Know what to look for!

While playing the market it is imperative to consistently look for edges. Markets change and as such one needs to be on ones toes. In a recent publication of ours we mentioned the change of the bitcoin market due to new market participants. Each time one suspects such changes to have taken place or being in their initial stages, it is advisable to review your system and question your edges. At the same time looking for abnormalities or newly establishing repetitive structural market behaviors could bring a new edge to add to your arsenal. Over time this process of ‘extracting hidden gems’ becomes second nature and assures the market participant to be ahead of the crowd. Therefore, you need to know, what to look for!

Let us share one of those recent behavior changes of the bitcoin market. It might be useful for your own approach towards crypto currency trading/investing!

Timing entries and exits can be a tricky endeavor. Good timing allows for less slippage, lower risk and ideally a higher probability of the desired turning point.

The next three bitcoin charts show daily starting times on hourly charts right before the start of significant moves. It also highlights the size of moves in points.

In studying these three charts you will find that the bitcoin market has found itself now more aligned with the US index futures market in regards to market participation time of day. The study shows similar times when the market turns and a larger move occurs. These times are the typical first and last hour for the futures market, 09:00 to 10:00 am eastern standard time and 03:00-04:00 pm eastern standard time. It also points out the typical 12:00 reversal time.

In addition you will find that turning points occur frequently at the end of each trading day (20:00 pm eastern standard time). These are marked with blue vertical lines in the charts below. This is due to high bot trading participation which determines much of its calculation based on final day calculations.

All of this points towards the mentioned market participant changes refereed to in our weekly chartbook from May 11th this year.

Hourly charts of BTC/USDT, 13th to 30th of May 2019, showing starting time and size of market move in points:

Bitcoin in Tether US, hourly chart as of May 30th 2019 a

Bitcoin in Tether US, hourly chart as of May 30th 2019 a

Bitcoin in Tether US, hourly chart as of May 30th 2019 b

Bitcoin in Tether US, hourly chart as of May 30th 2019 b

Bitcoin in Tether US, hourly chart as of May 30th 2019 c

Bitcoin in Tether US, hourly chart as of May 30th 2019 c

Information like this helps to know what to look for and to time your entries and exits. It also makes time slots available to find high liquidity in the bitcoin market to avoid slippage. One can also calculate ones risk appetite with this sort of data.

In the crypto chartbook of last week we advised to reduce the total portfolio exposure. We have further reduced our market exposure and posted this action live in our Telegram channel.

The timing of these actions has been supported by the above mentioned model.

BTC/USDT 5 minute chart 5/30/2019, precise 12:00 pm EST reversal time before a US$1,075 point price drop:

Bitcoin in Tether US, 5 minute chart as of May 30th 2019.

Bitcoin in Tether US, 5 minute chart as of May 30th 2019.

The weekly chart is now supportive of this exposure risk reduction and starts to confirm last weeks anticipatory move of taking first profits off the table.

Weekly chart of BTC/USDT – 5/30/2019, price advances running out of steam:

Bitcoin in Tether US, weekly chart as of May 30th 2019.

Bitcoin in Tether US, weekly chart as of May 30th 2019.

All charts timely posted in our telegram channel.

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About the Author:

Outstanding abstract reasoning ability and ability to think creatively and originally has led over the last 25 years to extract new principles and a unique way to view the markets resulting in a multitude of various time frame systems, generating high hit rates and outstanding risk reward ratios. Over 20 years of coaching traders with heart & passion, assessing complex situations, troubleshoot and solve problems principle based has led to experience and a professional history of success. Skilled natural teacher and exceptional developer of talent.Avid learner guided by a plan with ability to suppress ego and empower students to share ideas and best practices and to apply principle-based technical/conceptual knowledge to maximize efficiency. 25+ year execution experience (50.000+ trades executed) Trading multiple personal accounts (long and short-and combinations of the two). Amazing market feel complementing mechanical systems discipline for precise and extreme low risk entries while objectively seeing the whole picture. Ability to notice and separate emotional responses from the decision-making process and to stand outside oneself and one’s concerns about images in order to function in terms of larger objectives. Developed exit strategies that compensate both for maximizing profits and psychological ease to allow for continuous flow throughout the whole trading day. In depth knowledge of money management strategies with the experience of multiple 6 sigma events in various markets (futures, stocks, commodities, currencies, bonds) embedded in extreme low risk statistical probability models with smooth equity curves and extensive risk management as well as extensive disaster risk allow for my natural capacity for risk-taking.

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