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Lucid TA @Lucid_TA
, 13 tweets, 2 min read Read on Twitter
I recorded a market update earlier today but unfortunately didn’t have time to post it.

I’ll summarise the salient points here whilst in transit.
Though $4k was a reasonable area to expect a potential bottom, PA proceeding the low reduced the likelihood that this would be the case.

We would have wanted to see either a V bottom, double bottom or SFP ideally.
Weakness of initial response from the low invalidated V bottom potential.

The low was then tested a second time - potential for double bottom. Response off of the second test was lacklustre, a weak grind upwards.
The more time spent near the swing low, the lower the likelihood it becomes a bottom.

One’s default assumption should always be for continuation.
In absence of high confidence bottoming structure, the reaction off of the low becomes a period of consolidation (not reversal).

Following a period of consoldation, the more likely scenario is for continuation in the direction of the existing trend.
So basically; despite the fact that $4k was a reasonable candidate for a bottom, PA didn’t form any kind of reversal structure.

In absence of reversal structure, sideways PA is basically just consolidation. Consolidation typically precedes reversal.
A bit late now, but these basic principles may be applicable to PA that is soon to manifest.
In any case, I believe there is a strong chance that we’re about to find a near-mid term bottom.

The % drop right now is near the upper bounds of how far BTC has ever spilled without a meaningful retracement.
Typically retracements from similar moves are around 50%, though they have been as shallow as 38% (fib) or as significant as 78% + (fib).

Furthermore, this is also a 3rd impulse down, which - if one subscribes to EW theory - should be exhaustive (at least NT).
There aren’t necessarily any screamingly obvious price points to look to catch knives. Though I’d say both $3600 and $3000 are potential candidates.

If one insists on catching knives, I’d say aggregating bids between these levels could perhaps be a reasonable play.
For me personally, I’m simply closing the remainder of my shorts here. And will look to enter longs in a potential first setup in a new trend.

Which basically means I’ll wait for high confidence bottoming structure, and then trade the best upside continuation setup I can find.
The micro continuation setups I mentioned in a previous tweet have all made target, BTC has also hit target.
Stay safe, stay rational, and best of luck to everyone out there! $BTC
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