BTFD period – Forecast #40
Welcome to the November 19, 2021 report.
This is a very short update to cover the fundamentals behind BTC’d price action as it pulls back. In my last letter only 4 days ago the expectation was for a sideways consolidation. Since then the price has dropped from $64.3k to a low of $55.4k before climbing to $58.2k at the time of writing. It seems we have found our consolidation range.
Top level summary for 19th Nov 2021 (current price $58.2k):
Macro: Effectively unchanged since my last letter, retail continues to buy the dip while the price pulls back which is a strong sign of macro bull market continuation. As per previous letters, I expect a bull run well into Q1 2022.
Short term: HODLers have been buying this dip strongly providing support for the current price levels.
Ethereum Notes: ETH has dropped due to its trading correlation with BTC. Meanwhile on-chain fundamentals continue to strengthen. I’m bullish ETH/BTC.
BTC price action expectation: Bullish.
Price action conviction: High.
Where to buy BTC…my FTX referral >
It’s that part of the cycle again where I’m being asked where’s the best place to buy BTC…
I use FTX due to their low fees and excellent liquidity. For limit orders the fee will be 0.02% or less, even as low as a 0.03% rebate (i.e. you get paid when your order fills).
1) Daily stochastic RSI showing a reversal at the bottom of the indicator along with a daily bullish candle;
2) Phoenix weekly indicator shows downward pressure however a long way away from a bearish market;
3) Major fib support levels from different on multiple charts indicate 56K is a strong support level;
Macro: retail continues to buy the dip
Retail, defined as HODLers of 1 BTC or less, continue to buy the dip as price pulls back. It turns out that retail has a large influence in the macro cycle, bull markets come to an end when they stop buying. This is not what is happening, in fact buying from retail is very strong signalling this period of price pull-back is a consolidation and not the start of a bear market.
Short term: Retail investors continue to buy the dip
In the chart below we can see that HODLers have been buying this dip, while speculative swing traders are holding onto their coins. This is the first major buying impulse from HODLers since early October.
The heatmap below shows effecively the same data in a different view. Buyers have been stepping in strongly.
Ethereum on-chain demand continues to hit all-time-highs, even while the price pulls back due to its trading correlation to Bitcoin. Fundamentals continue to favor ETH relative to BTC.
BEFORE (Above chart) and NOW (below chart)
> Weekly 10 MA acting as support along with the BARR trendline. Its also the local impulse 0.618 fib level for the bottom of the red candle on the daily.
> Chart on the right has the Log curve zone medium also confluent with supporting level for ETH indicated by the yellow arrowgrey line.
> Phoenix on the daily have cross with the green rsi with the red and blue showing upward momentum and a possible reversal.
> Conclusion: ETH demonstrating strong support level with a bullish daily candle close.
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