Are You Shorting Bitcoin Right Now? My Bear Case For a 40K Bitcoin

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I hate to be a bear, but, the Weekly candle close on Bitcoin held the SELL signal of the Logical Trading Indicator PRO, which is really not a good thing for a bull market. On this long of a time frame, these signals can be very strong indicators of the direction the market is moving. So I would be taking this seriously and if you are not shorting BTC, you might think about starting. If you are not in the shorting camp, then start thinking about some 40K buy orders, because we are heading in that direction. But of course this isn’t financial advice, it’s just my bear case for a 40K bitcoin!

The 40K range was the last real range of support for Bitcoin before it took off to 74K back in March/April. In my opinion, we went too high, too fast and we are due for a correction to build more market structure at these levels. You know the old saying, what goes up, must come down.

Moving down the time frames to the daily candle, you see that we have begun a pretty strong down trend with the next big demand order block being in the 40K zone. Unless something massive changes, it’s best to stay with the trend until it ends. By the looks of it, this downtrend is not ending soon.

Even the massive gap in the volume profile tells a big tell. There was really no volume at the price ranges between where we are now, and the 40K level. This means very little action at those price levels in the past, meaning there probably isn’t many orders hanging around and waiting. If we can’t hold our current levels and break down, there is nothing stopping the drop to the next big order block where there will be some big buyers waiting.

And as if you needed any more confirmation, here is the 4 hour candle chart showing the bottom falling out and order blocks at the 40K range. The prediction model on the Logical Trading Indicator PRO is even showing a continuation based on past data and a linear regression calculation.

Could I be wrong? Absolutely! And have been many time, but, it’s hard to argue with this kind of chart data screaming for more downside. That is why it’s important for you to do your own research on any asset you are trading. Bitcoin just happens to be my main trade, so that is why I am so laser focused on it’s price movements. So until the trend, and moral improves, I am a short bear.

Are you on the bearish side too? Or are you a perma-bull and believe that Saylor and Wall Street are going to save your bags? Because if that’s the case, I would like to slap you around a bit to wake you up to the truth that this is caused by Wall Street and government sell offs and they are not here to help pump your bags. You just have to ride their wake and scoop up what you can when you can. That’s the retail game.

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Additional Blog Locations

Many of my cryptocurrency related articles as well as trading articles can also be found on my crypto research site, Coin Logic.

I also post trading chart ideas on my TradingView Profile.

Disclaimer:

The information in this trade journal is for educational purposes only and should not be considered financial advice. Please consult with a qualified financial advisor before making any investment decisions.