I just want to post this quick video, following up on the Bitcoin video that I made showing the four-hour chart.
I wanted to do this to highlight some important points on the chart. If we look at the chart, you can see where I actually posted the video. I received an email about continuing with the trend and when you could stay with it.
In this case, the pattern indicated that the red started coming in, so we’re staying with this. You can see how the market comes up, puts the pressure point in, and then goes down, indicating a trend continuation.
Now, I want to move over to the 30-minute chart. I highlight these time frames with Bitcoin because a longer time frame provides more stability. I wouldn't want to trade Bitcoin on a 5-15 minute chart; I prefer looking at a longer-term trend for more stability.
You can see both cursors synchronized, and you can observe how stops would have been removed. Looking at both charts, you can see where the crosshair is positioned and what occurred there. The market has another lift-up and then puts another one in.
This indicates that we have a pressure point down here, and you can see that the stocks have been taken out. This is a classic example of the breach being made and taken down through. However, we won’t buy into this market because we see significant downward pressure.
Then, we have a continuation where the market breaches yet again. This is a breach trade, and we’re still trading everything lining up here. The market breaches again, and we have the pressure point, indicating it's time to exit the market.
Traders who sold down through here would have placed their stops accordingly. As the market comes up, we see why we get this long move: It gains momentum and punches out the stops, leading to a failure in the market, continuing down.
We could keep this in mind and wait for a pressure point or a dip after a pressure point before joining in on the subsequent continuation move.
I hope that helps, and I’ll catch up with you soon on the next video. Take care, and have a wonderful day.
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