Yesterday, as a result of overnight trading on Tuesday, a double top gave us a medium term bearish bias in the bitcoin price. The pattern completed mid afternoon, and we were able to enter short according to the pattern’s traditional rules on a neck breaking. Post-entry, price initially moved in the direction we’d expected, before correcting a little to the upside and consolidating somewhat throughout Wednesday evening. This is not unexpected, and the bearish trade we entered on the pattern yesterday remains valid. On the short term timeframes, at least, we’ve some some medium term upside action, and with the pattern confirming the end of this action, it’s not unusual to see some sideways consolidation, as markets take stock of what’s underpinning the volatility.
With this said, we’d like to see (from a short term perspective) a dip in the bitcoin price towards our downside target. We’re hedged to the upside on long term holdings, and we’ve got a stop in place to ensure that if the bitcoin price reverses to the upside and continues its bullish run then we only get taken out for a small loss, but a profit is a profit, and we’d like to take one as