Why Bitcoin Traders Should Be Worried 

Bitcoin traders need to be worried for a number of reasons. At the top of the list is lack of confidence in their trades. Most people in this market cannot make a decision. When they make a decision, they keep doubting it. Now, they worry about that decision but I don’t call it worrying. That is just wasting time. Worrying would be if thinking about that led to something productive, let’s say a strategy. The reason it is important to have a strategy in place is because markets can be unpredictable. You have to know what you would do in case a trade goes against you.

I expected the beginning of a phase of confusion in the market soon as BTC/USD shot past the 200-day moving average. That is where a lot of retail bears started to doubt themselves and began to question whether they were right. If being right means a clear rejection of the 200-day moving average at a point when the stakes are this high, then perhaps you would be better off buying and selling rather than actively trading. There are only two things that matter in this market. The first is technical analysis and the second is psychological analysis. Forget about fundamental analysis and how many Bitcoin are there or will ever be there. That is of no consequence. 

If we take a look at the ETH/USD chart, we can see that it faces the same dilemma. Will it hold the 200-day moving average or fall below it? This is why I keep saying it is important to wait for confirmation. If the price ends up declining below the 200-day moving average, you would know that a new bear trend is about to begin. If it finds support above the 200-day moving average and prints higher highs and higher lows, that is when you can start looking for bullish entries and expect the beginning of a new bullish cycle. 

The mistake most retail traders make is that they so easily fall for what the average shiller on Twitter or Youtube is saying. Everyone has a motive. It is important to be able to weigh analyses based on their merits and demerits and not to be carried away by sentiment. Most of these shillers have an incentive to gain more likes or followers if they talk about the popular opinion i.e. being bullish on the market. However, that is not where we see things going. The market is expected to see a major decline before halving, then a potential rally after halving which would be another bull trap and then eventually a slow bleed decline to Bitcoin’s true bottom slightly below $1,000.