Yesterday, we explained our neutral bias over short time frames. With elevated futures leverage, we continue to anticipate whipsaw-like price action.
Last night we saw this manifest, with Bitcoin $BTC sharply selling off, giving traders yet another failed breakout signal.
This was the first strong selling we've seen in Asian hours for a while. As it stands, this is not a friendly tape for short-term directional trading.
As we said yesterday, this appears to be a “fade the breakouts” type of environment.
We also discussed the following altcoin index chart, noting that alts haven't provided a strong buy signal over short time frames.
The index is still below key support, on an absolute basis and, more importantly, relative to Bitcoin.
So, in today's post, we want to be overly obnoxious in arguing for patience.
It boils down to a few key themes:
- There's little to no directional conviction over short time frames.
- Macro and crypto markets are acting hostile to directional trading.
- The common setup among alts.
Let's dive in.
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