BTC Sunday update:
I'm still hoping to see a sweep of the highs to hit the retail short liquidations.
Then I'd pay attention to the candlesticks for a potential short to fill the Liquidity Pools (LPs) and the 2 wicks below.
What's the idea behind this setup? Let me explain
This is how retail thinks and trades.
Retail places their stop loss right at the previous high. This means that a quick move breaking that high would stop a lot of positions (liquidity). The market moves based on where the liquidity is.
This is why +90% traders lose money.
Liquidations are another form of liquidity.
There are 15B worth of short liquidations at 19.9k (7d tf).
19850: 6B 19900: 6B 19950: 3B
CME gap (BTC1!) at 19200.
Most CME gaps get filled within the next week.
Open Interest gaps have proved to be zones of interest in the chart.
Market wants to have as many open positions as possible so there is more liquidity, even though they're going to liquidate one side later on.
So passing through those areas would bring liquidity into the chart
Why don't I see a bullish PA?
- First 1 year yellow liquidation bar at 17.4k - Unrecovered wicks from 19k to 18k - Fast moves = False moves as they create and leave liquidity pools behind
CT will induce you to swing long here. I only see shorts liquidity hunts for now.This post is based on this twitter thread.