Guys, this is Technical Analysis 101.
You don’t buy an asset that’s just broken a level of support. If you do, you’re only asking for trouble.
As technicians, we keep things simple, and we tell it like it is. We’re not afraid to call something a piece of shit if that’s what the data tells us.
I find a level of beauty in this process.
It doesn’t matter how elegant your theory or big your I.Q. If the market is below a certain level, it’s all wrong.
The moment Bitcoin lost these lows, it was straight back to defense:
Did we like the idea of defining longs against the prior-cycle highs of 20,000?
But, like any trade, there has to be an invalidation. For us, it was rather clear: If we lost this level, it was lights out.
Don’t be that guy heroically buying into support breaks like these.
There are just so many examples out there it’s impossible to count. Buying support breaks is a terrible strategy.
Do I need to bring up May 2021?
The market has spoken.
Get out, and play defense.
There are only two ways we want to focus on the long side here, if Bitcoin recovers above this broken support or if buying dips back toward the 10,000 area.
We can’t be more blunt.
Respect the levels and manage risk.
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