Bitcoin Faked Out Everyone?
Statsedgetrading
Bitcoin's Rollercoaster and Crypto Dynamics
We started the week focusing on Bitcoin, witnessing a significant sell-off. I had been shorting as the price dropped, but I began scaling back my positions near a previous high. Despite a substantial rebound today, Bitcoin remains within a frustrating range. The weekly chart hints at potential fake breakouts and breakdowns, maintaining the unpredictability we often associate with Bitcoin. Ethereum, interestingly, did not mirror Bitcoin's movements, an intriguing sign for those of us who appreciate uncorrelated assets in trading.
The Dollar Index and Its Implications
The dollar index's performance is a concerning signal for a potential equity pullback. The dollar is holding strong, contrary to my expectations of a rapid decline after a brief bounce. This resilience could be a bearish indicator for equities, and I'm keeping a close eye on this trend.
Forex Markets: Cable and Aussie Pairs
The Cable (GBP/USD) is stuck in a limbo, oscillating without clear direction. Gold, on the other hand, remains robust, suggesting potential trading opportunities if the dollar's strength reverses.
In the AUD/JPY and AUD/CAD pairs, I've noticed distinct patterns. AUD/JPY is struggling, while I've taken a short position in AUD/CAD, benefiting from a break below a key anchored VWAP level.
Equities: S&P 500 and Sector Analysis
Moving onto equities, the S&P 500 presents a mixed picture. An RSI divergence on the daily chart suggests we might be due for a pause in momentum. Sector-wise, energy and commodities are showing strength. I'm particularly interested in oil for potential trades, considering its inflationary implications.
A Strategic Approach to Short Selling
In addition to these observations, I've been exploring short-selling opportunities to hedge against my long positions. Stocks like Path and Yelp, showing relative weakness compared to their sectors, are on my radar. These are strategic shorts—insurance against a broader market pullback.
