After several weeks of high probability patterns playing out, you can now see an example of when they don’t.
Bitcoin has shot up from around $450 USD to $520 (as I write this) in a matter of 3 days. Clearing the important psychological price of $500 plus breaking the top of the prior pattern at around $480 along with dramatically higher trading volume are all powerful signs that the pattern showing lower BTC prices is not the most likely course.
This is why I started this blog with the tag line “Just probabilities, no certainties”.
The patterns I follow work MOST of the time. However they certainly don’t work EVERY time and managing that reality is the key to long term success in trading anything.
It’s worth noting how BTC shot up dramatically right around the top of the pattern. Once a pattern is broken price can (and often does) move in the opposite direction very powerfully.
So where does BTC go now? I don’t have a clear pattern with a clear target to share. I can say that several indicators I follow say BTC is near the top of this particular up move, but a small correction in price could reset those indicators and allow much more upside for BTC.
On the other hand, unless price reverses very quickly on high volume here, the probabilities are for higher BTC prices with a minimum target of 560. I’ll be waiting for a clear high probability pattern to emerge before buying or selling BTC.
Full disclosure: I have a small position in BTC from around $465 that was taken once BTC cleared $450. The probabilities then slightly favored more upside and I justified the entry without a clear pattern because I needed to have funds available for additional investments in ETH.
As for ETH and DAO, neither are showing any signs that major upside is imminent. ETH is holding up well around the $11 USD level. DAO seems to be dropping relative to both BTC and ETH. My position on ETH is about 130-140% above my core investment with an average price around 9.50-10 USD overall. Target remains 17.50 USD as long as ETH remains above recent lows.
No guidance on DAO at present though I would expect large moves in both directions during it’s early phases of being publicly traded.