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Sunday, December 4, 2022

Looking For A Great Entry On Bitcoin

Acknowledgment: Derek Pennings came up with “The Entry Indicator.” I helped him with putting the thought process in writing. You can find him on Twitter @PenningsDerek.

Not Again

It happened. Again. Price dropped more than 50% from its all-time high. During times like these, people wonder whether the bottom is in or not. Nobody wants to sell the bottom. And nobody likes to buy a dip that keeps on dipping either.

There are a lot of indicators. Some of which we call “on-chain” indicators and some are technical price indicators. For example, the relative strength index (RSI) on the daily time frame. When it hits 20 or lower, then it’s really something. Or what about Fibonacci levels? All great indicators to get some sense of price action. But does it make it a great entry indicator? It may be useful, but it’s always relative to the previous price action, which isn’t a fundamental threshold. It’s technical.

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