Bitcoin: Setting Up For Something Bigger

What's up, guys? Welcome back to another video. So yesterday we had a interesting situation where we managed to accurately call the fact that you would get this liquidity sweep right here sometime during the London session. And as of the time that I was recording the video, we were kind of here. And so eventually all of the people that went long here eventually got stopped out. Because Asia tends to be accumulation, London has to be manipulation. And then I also called for a New York distribution to happen sometime during the New York morning, and that ended up playing out well. Right, right. Hopefully I've saved you guys some money from not going long at any point here because eventually you would have gotten stopped out on both of these moves right here. And hopefully I've allowed some of you guys to catch the move of the New York distribution. Just that like this sweep below Asia Lows was called for and, you know, the direction was supposed to be up. Now here's the interesting situation that happened yesterday as well. It's that yesterday ended up closing as a inside bar. Inside bar. By the way, for those of you who don't know what that is, it is a candle that does not sweep either the high or low of the previous day's candle. So on this day right here, if you guys recall to the video from two days ago, we did, you know, correctly kind of anticipate this saying that because this previous candle was really, you know, volatile, there was a very large range created, that this day would be a little less volatile and that the day would very likely close at a as an inside bar. This is. This ties back to the very popular saying of how, you know, markets always moves from periods of high volatility to low volatility. That's why you always see, like, after aggressive moves, price tends to just chop around. And it also ties back to the popular saying, right. People like to say all the time that, oh, the longer price spends in a consolidation, the more explosive the move coming out of it will be. And that is true. Notice just a function of the markets. It's kind of how the markets work. You go from high volatility to ranging conditions. Now, what I did not anticipate yesterday, even though we didn't mention the fact that there was news. Sorry, there was no news yesterday. If you take a look here, yesterday you only had audusdollar news. In fact, it wasn't really even yesterday, it's today. Like, I mean, I'm in Asia, so. So, yeah, there was absolutely no news yesterday. And we also did, you know, mention that closer to the end of the video where, you know, without news there tends to be less volatility. So yeah, yesterday ended up closing as an inside bar. The range from the high to the low of the day, if you see the high here, 104,000. And the low of today is like 102, 500. So quite literally just a $2,000 range. Not the worst, but not the best either, given how new bitcoin usually pulls two to $3,000 ranges very, very easily on an intraday basis. So yeah, at the moment I think this was kind of a win. The only problem was that the target that I set for yesterday because I was kind of anticipating the markets to actually give us a little bit more of a movement was the previous daily high or the high from two days ago. So ultimately we did sweep out the Asia highs and ultimately we did accurately manage to predict the fact that there was a AMD setup. And so because of that, it's like I would say it's a win, but it's also not the strongest win, at least not what we usually do. Just to give you an idea of what I'm talking about, ever since February I've started tracking the public calls that I've made on YouTube. And starting at the end of yesterday, we were we. Because we lost the one from two days ago, we were at 52 out of 65, which puts us at a solid 80 win rate. So this is why I'm spending some time talking about this scenario and whether or not to classify this as a win or loss. It's very important to the overall track record. I'm inclined to call it as a win. It's not an amazing win. It's not a super solid win like we usually do. Like, it's not really a loss either because the, the situation that ended up happening yesterday was due to market conditions and less about like the reading of the technical analysis. Sure, I think I could have anticipated it better. Again, I'm inclined to call it as a win even though it's not a strong win. But I'll let you guys do be the judge of that. What do you guys think? Should this be a win or should this be a loss? Let me know in the comment section below and I will take the majority answer after like 24, 48 hours. Yeah, and anyways, with that said, I'm going to give you guys the update on what's going on with bitcoin today and give you guys an update to the overall situation. So immediately right off the get go, just starting things off on the Daily chart there is, we're still within this the gap, right? We mentioned this yesterday. Overall weekly, you're still within an uptrend. Taking a look at the overall trend that is definitely uptrend. And in terms of order flow, you are also in an uptrend. So long term time frame, you are still within an uptrend. Let's take a look at the daily chart. Daily chart, you are also in bullish order flow. And given the fact that right now you are sitting so close to this previous daily high means that, you know, at some point I think you're going to take this out first before any sort of significant retrace. So for me, I think the overall trend in the daily chart is still towards the upside. And again, one of the reasons that I'm starting things off on the higher time frame is to ensure that we're not getting confused by the lower time frame noise that we're trading in line with the higher time frame trend. Now, taking a look at yesterday right now we go from macro going back into, you know, kind of zooming in into the micro. Yesterday's daily kind of closed bearish, although it was an inside bar. But purely based off of that, that would lead to the daily bias today being towards the sell side. And so right now, this previous low here is also a weak low that is within a fertility gap, right? This entire fertility gap here has not yet been filled. I know some of you will say that, okay, that is the actual fertility gap, right? Yeah, you are correct. But the problem is that this is already filled. So now we refine the fertility gap lower. So for those of you OCD people, this is how the fertility gap is looking like at the moment. So this low right here is a weak low. For those of you who do not know what this is, this is a low. Weak highs and weak lows are any lows and highs that did not sweep liquidity prior. So this, for example, this is a swing high and this swing high got swept by, you know, this candle right here. And so this becomes a strong high. Now, the reason why we take this into consideration is because strong highs and lows tend to be respected and they tend to be protected more than weak highs and lows. Weak highs and lows tend to be targeted. Actually, price actually just shoots towards them more often than you would expect. And so right now you have a weak low right before a F gap, which is a classic setup that I tend to look for. So that kind of adds a little bit of confluence to this bearish daily bias. Idea that we have. So currently price is already trading lower, but let's see if we can zoom into the lower time frames to see if you know, this is the end of the move or if there is an opportunity for us to jump into the move later today with potentially a Asia accumulation, a London breakout and then New York continuation model. So taking a look at things in terms of the one hourly chart, let's mark out some points of interest. Right now, depending on how this candle closes in about nine minutes, there may be a fair value gap over here. But at the moment the only thing I see is this bearish order block. And part of what I'm doing here by the way, is that the one hourly chart is usually used for points of interest. I'm not trying to find entries or whatever, I'm just looking for points of interest. So just to give you an idea, my daily bias is towards the downside. Right, right now all I'm looking for is bearish PD arrays or bearish points of interest for me to essentially I'll mark these out so that when Price returns back to these areas during, you know, one of the sessions, right now we're within the London kill zone. Let's say later on we go into the New York kill zone and there is a fair bit of gap here. Then I'm going to hop like once Price enters into the zone and hop onto the five minute and to take a trade. That's how I refine my trades from the daily chart all the way down to the five minute. But yeah, so far only thing I can see here is a bearish order block. Not really much to talk about. There is also a potential liquidity level deck here that can be hit. So just going to mark this out. And lastly we're going to go into the five minute to see if I can refine some kind of entry. So this Asia, you know, this Asia accumulation London breakout model seems to be playing out already. And later on we do have news. At what time is it? 8.30am and 8.40am in fact, today's probably going to shape out to be a very volatile day. So I think based on this there are two ways that this kind of plays out, the first of which is you have your Asia accumulation. London broke out very convincingly. And so we can look for kind of like a retracement within this range here. Now we could draw a fib kind of like this and you'll see that that bearish order block lines up with 2.5 of that Fib. So if you were to retrace into, you know, this zone right here or potentially yeah, if you were to retrace into the zone or any one of these like bearish order blocks. As long as you're within a kill zone, meaning right Now London is 2am to 5am New York and then you have the New York open kill zone which is 7 to 10am as long as you're within these timing windows and you get a retracement and you see stuff, see the market start to break down, then that's going to be your trade setup, right? A lot of people tend to get caught up in the fact that, you know, you have Asia accumulation and people always think London tends to be manipulation. And the key word here is tends to be. It's not always the case. There are certain, well, there are many days actually where the price actually shows a London breakout and a New York continuation instead. That's how you get these clean trending days. So don't be fooled. Doesn't always play out in AMD just to, you know, answer you guys. So today definitely looks like kind of a continuation setup. And that's going to be scenario number one, like retracing a good portion of the London move and then New York will kind of lead towards the downside. Now the second possible scenario is that you will take out some key liquidity levels going back onto the one hourly chart. You may or may not reach this level before the news opens or you may or may not reach this level before 8:30am but if you do, then perhaps this day is going to be a very volatile style of where Asia and London are very volatile and in New York is also going to be very volatile, but in the opposite direction. Right? So V shaped recovery, a reversal setup basically. And this highly depends on whether or not this level right here at 100,650 gets hit prior to the New York session or sometime close to news or right after news. If you get situation like this, then perhaps you will get a V shaped recovery and that's the trade that you should look for. But otherwise I think as long as you do not hit these lows, even if you were to bounce between these lows, by the way, the fact that you have left a low behind here without sweeping out this liquidity means that these are now relatively equal lows. And just like what I've said before and just like how countless times in the past I've, you know, cautioned you guys against taking longs into relatively equal lows such as this, these are all Relatively equal lows. Eventually boom, right? In one quick move, you get swept before the price, you know, kind of reverses. Same thing here, right? With relative equal lows. Sure they may not be taken immediately, but they will be taken like usually sometime in the near future, depending on the timeframe that you're looking at, of course. And when they do, like, you just do not want to be, you know, holding along and putting a stop loss right below because then you're quite literally giving free money away back to the markets. So that'll be the two kind of possible setups for today. And just to kind of leave you guys with a little nugget of gold because ultimately I do still want to try to educate you guys. It's also part of the reason why I'm always spending a lot of time explaining my thought process. Like from start to finish, A to Z. I believe the biggest improvements does not come from the outcome. Right. It's not about the P and L. It's more about fixing your thought process and fixing your inputs. And if you can consistently put the right input into the system, you are always more likely than not to consistently get a quality output or rather the output that you're looking for. So before filming this video, honestly I was feeling a little bit uncertain because the last couple of days, well, this day here was a loss and yesterday was kind of like a weak win potential loss. I'm not sure. And given the fact that I'm putting myself on the chopping block here by publicly, you know, tracking the win rate of these videos, there is a certain pressure that comes from wanting to maintain an 80% win rate. So honestly, coming into this video, it, there was a bit of uncertainty because I just went through what you would call a losing streak. We haven't had a single loss in the past two weeks. Just to give you an idea, like we were spot on every single day for the last two weeks. I'm sure you guys have gone through situations like this before, you know, in your trading where, you know, you go through a little bit of a rough patch and it doesn't matter who you are, by the way, like even myself, like this happens very often, more often than you think. And the what's important is our reaction to when we are faced with this situation. And for me, the first thing I do always when I'm faced with this predicament is I always try to identify if this is a problem with my system or if this is more of like a market conditions or like environmental or even just variance type of Problem. Let me explain what that means. So a systems problem is that somehow like a system based problem is essentially that my system is not that accurate, right? I don't have an edge. It's not a system that allows me to be right more often than wrong or in the sense of trading. It's not a system that allows me to, to be making more money than I'm losing over the course of, let's say a block of 100 trades. And if you do not have a system with edge, then that's the first thing you fix. Because without edge, nothing else matters, right? If you cannot be right more often than you're wrong, or if you cannot make more money than you lose, then well, guess what, the system's flawed and you shouldn't be using that system or at least you should be improving that system to the point where it does have an edge. So now that that's out of the way, I can tell you confidently that this is not a systems problem, right? Because so far over the last three and a half months we have been RA 80% of the time. So clearly, clearly this is a system that has edge. And so now we move on to the second thing which is variance and you know, kind of like a market conditions problem. So yesterday as mentioned, right, we, we didn't have a strong convincing win primarily because of market conditions. Instead of having a trending day, we ended up getting an inside bar. In fact, we got a very tiny inside bar. And that's not something that, yes, you can kind of anticipate it, but it's a little bit tougher to do that. And so market conditions aside, there is also, I think, and so I can probably, you know, associate the day yesterday to market conditions rather than assistance based problem. I think you guys would agree with that. Now here comes the second thing that I think really gets a lot of you. This is, this is more for you, less for me, which is variance. There is a saying in trading. In fact, this is one of my favorite sayings in all of trading is that you can do everything right, you can put all of the right inputs into your system and you will still end up with a bad outcome. And that is just par for the course in trading. Because this is a game of probabilities, much like poker, right? Just because you have pocket aces, it does not mean that you are 100% guaranteed to win the hand. Any of the cards get flipped, you are statistically speaking the most likely to get to win the hand basically or to win money, right? Just positive expected value. Same thing with trading. If you do everything right, it just means that you're stacking the deck in your favor, does not guarantee 100% success rate. And that's where variance comes in. Right. There are a lot of times where you'll do everything right. You get a bad outcome. And I think it's so important that you actually reflect on that trade or that series of trades and figure out if it is a systems problem or if you were actually, in fact, doing things right, but you just ended up with a, you know, negative outcome, which is completely fine. It's just part of the game. What's important is that you are profitable over the course of a hundred trades rather than, you know, a course of like 10 trades. And on that note, there are a lot of people that tend to struggle with figuring out if what they're doing is right or wrong. Don't worry, I'm not about to give you a sales pitch. Uh, but what I will recommend you is to watch this YouTube video that I've posted the other day. This is a review like me sitting down for 40 minutes reviewing a backtest that one of my students sent me. And in that, in that video, I kind of point out what the student is doing right and what that student is doing wrong. And hopefully this will help you guys also fill in the gaps, fill in the blanks and help you figure out if you know what you're doing is right and what you're doing is wrong and ultimately help instill some better habits and instill some better mindsets. But otherwise, if you enjoy these analyses done from a smart money perspective on crypto, make sure you subscribe. Coming to you guys with daily videos. And now you should definitely go check out that backtest review video. Cheers.