1/17/2017 The Market View and Trading Outlook

No real need for a detailed analysis today as what is occurring is going to continue to occur until it does not. While that may sound as about as ambiguous as any statement could possibly sound it essentially the truth. We are in the midst of a correction that will continue until we find a solid floor. For me I’m basically sitting on the sidelines at the moment waiting for the time to buy.

We are entering the capitulation phase and are perhaps still in the denial phase to some extent. A good explanation can be found here:

Eventually the market tops out well below its previous high and starts a new downleg carrying it to lower lows. During this phase the fundamental news significantly worsens and investors realize that that a bear market is in force. This is the phase of concern. During this phase many investors sell, but others hang in, feeling that the bad news is discounted and that a bottom is near. At this point the market may rally again as many observers feel that the decline has ended and that a new bull market has begun. This rally, also characterized by weak breadth and low volume, subsequently fails and heads down. At this point the majority becomes exceedingly bearish and throws in the towel, fearful of further declines and the potential disappearance of their assets. This is the capitulation phase, when stocks are sold on fear and emotion rather than on rational analysis. It is at that point that the market is finally ready to make an important bottom. –
Source: http://www.comstockfunds.com/default.aspx?act=Newsletter.aspx&category=MarketCommentary&newsletterid=1348&menugroup=Home

And Here is a solid short answer to what they actually are:

Capitulations are outcomes that result from the maximum psychological and financial pain that can be endured by a group before throwing in the towel.

Source: https://www.investopedia.com/terms/c/capitulation.asp

So the question is how much pain can you take before throwing in the towel? If you are already out and sitting in cash then you have nothing to worry about.

This unfortunately is the time to really adopt a “fuck it” mentality if you got trapped in ALTS on Bittrex as many may of already bottomed out and are as likely to run back up when all this finishes up. I think I lost $1500 in paper profits or absorbed $1500 in paper losses depending upon how you look at it on Bittrex the last couple days. Oh well, “fuck it” I moved around a few coins, went to some store of value coins and some of the big losers well I’ll wait it out. No need to drop out now to see them whip past when all this is over.

I’m not in denial, I just don’t care and as I did not go in with more than I was willing to lose and as I am trading profits from the last year or so of work.. “fuck it”. Would I feel differently if it were my nest egg so to speak or if I had gone in too deep? I’m sure I would, but that is the value of trading reasonably and with rules over a prolonged period of time. It gives you cushion, helps avoid panic when things go south and allows you to remain objective.

I am really beginning to see capitulation (though it cannot be said for sure till its all over) in many of the Alts. You saw them just hanging on, and then a big sell, then another, then another as investors just can’t take the pain anymore and start realizing their losses. It sucks, but it does present good buying opportunities in the long run.

As for BTC and for those follow me, I find it noteworthy now that BTC is officially lower in price now than the highest high BCH has achieved on Coinbase. I also find it interesting that BTC @ $9200 is now just over double the historic highest high of BCH on Bitfinex @ $4104. The gap has narrowed between the two considerably since the initial fork wherein 1 BCH was less than 10% of 1 BTC. Again as I am a conspiracy theorist to some degree and I and the rest of the world know that BCH is the technologically superior product could a flippening be in the works? We will have to wait and see.

I wrote an article about this topic at one point:

https://steemit.com/bitcoin/@pawsdog/is-bitcoin-dead

I also covered this theory and the correction we are now in during the Christmas eve market report:

https://steemit.com/bitcoin/@pawsdog/12-24-2017-the-market-view-and-trading-outlook

Korea crypto ban is the major news if you read that article

As I have to include at least one chart to feel good about posting a market report I am going to post the only one that I feel matters at the moment; the weekly BTC chart.

It does not look particularly good in the grand scheme of things and historically we get 2 or more red bars on the MACD indicative of 2 or more weeks of pain and misery. It just went red yesterday so the bleeding has only just begun and we have a lot more HODLERS to shake out before we can make positive strides upwards. Of note, week over week selling volume is actually beginning to increase as more and more folks begin throwing in the towel and realizing their losses. RSI is heading lower to oversold territory but is not there yet, and we finally had an MACD/Signal line crossover to the downside. As we have busted the longer term moving averages on every other time frame the next stop is the 21 period moving average of the weekly chart around $8500. If that fails the next stop is the 77 on the 3 day chart around $6500 which worst case should be the end of it. That said if we get to that point do not expect a stop at $6500 as panic selling and capitulation will be at its height and we may slash well below that for a short time before coming back to it and building from there.

I expect us to fight up get rejected, fall again, fight up, get rejected fall again over and over until a lot of people lose a shit load of money and finally toss in the towel.

I saw a comment on Steemit when BTC was trading at $17,000 about a guy wanting to get a loan on his house to buy BTC and just pay it back with profits. At that point I knew for a top was nearwhen that type of stupidity begins to enter the picture.

My Previous Analysis:

https://steemit.com/bitcoin/@pawsdog/1-16-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/1-15-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/1-14-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/1-13-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/1-12-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/1-11-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/1-10-2017-the-market-view-and-trading-outlook

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