so last time we looked at moving
averages and how if you and how they
provide structure support and resistance
you needed to look at bitcoins using the
daily and weekly in time intervals and
then try different time periods so maybe
10 day moving average 20 day moving
average or 10 week moving average 20
week moving average and kind of see
which ones seemed to be important so I
think with the 10 with the 10 day moving
average it's the more the 20 day moving
average that seemed to provide support
for the for a lot of the move recently
as in the last few months with bitcoins
and so then you could kind of go when it
when the market dipped to near the
20-day moving average you'd want to
maybe buy a band with a stop loss just
below because if the trend continued the
20 days team to be support
here we're gonna use a Fibonacci
retracements which used to be available
on daily effects but it seems to have
disappeared so if you go to trading view
calm I hope your URL in the description
below the video we just click on the
pitchfork which is the same as what you
used to have to do on daily effects as
well then I click on it again and we get
a list of options I want a Fibonacci
retracement so I just click on that now
here it's there's no really set answer
like for Fibonacci retracements you you
set a low and a high and then it tells
you what the important levels are gonna
be or could be so I'm gonna say that
this was the recent low so I'm just
there then I click move them as up to
set I'm gonna use the the hi there so
the candle I'm just gonna set that and
then I'll talk about it
there I think about dinner so you see
the candle the price went up to here and
then fell back so the candle marks where
the opening and closing prices were and
then the wick is how much like where the
price has been during that day since
this is a daily cab
so once you set that you know once
you've done that the Fibonacci
retracement to marks the important
levels so the typical one is 50% so if
this was the low point and then it moved
all the way up here you know the top of
the work there then we'd expect that the
50% will be important and you can see
that here that the price did stop and
bounce off this level
remember traders at this stage would
know that this was the recent high and
this was the low so it would want to
kind of test the Midway then where did
any of the other levels show up not
really well again when it was this is
when it was going up that this the 50%
know that this isn't the 50 so is the
61.8% retracement that was important
when the price was going up
since at this stage we didn't know that
this was going to be a high that's one
of the joys of Fibonacci I mean it is
very fractal so you get patterns you get
the same ratios showing up again and
again and again so you went up went up
here it bounced off the 50% it kind of
hung around here as well since it's not
gonna be exactly at that number but you
see when I went up it struggled with
this level fell down this was this level
was also as kind of support like when I
was falling it struggled a bit tried to
go back up try to go up to the 50%
retracement couldn't fell back down to
the 60 1.8 was kind of unsure tried to
go up it cross it through the 61.8%
61.8% support and then was unable to go
back through it then I went back down
here to the seventy eight point six and
again you can see here when I was going
up a couple of times you know the candle
was here it tried to go down to the
78.6% level but didn't manage to do so
so you know this level was playing a
role even at this stage before it had
ever gone all the way up here to set up
this structure you know to be it hadn't
actually ever gone up to this level so
that we didn't know back here that this
was going to be an important high and
this was going to be an important no so
that's the weird geometry of
Fibonacci retracements so how does that
help us
well it's just they're important levels
that they they tend to be tricky too
they tend to be important or they tend
to show up for no reason so once it's
gone up here and now it's falling you
wouldn't you would have been looking for
okay it's up here will it managed to get
through this level the 23.6 cuz you know
that's 0.236 so you could call that 23.6
yeah easily went through that level in
the next candle it didn't really manage
to get back above it so this didn't
really play much of a role it easily
went through but at the same time it
easily went through it on the upside so
you know it it just didn't seem to play
that bigger role so now it falls through
that no problem is perhaps the 38.2%
level is going to be tricky well it
seemed to be an area that it hung around
like so it went through the this first
level it then even went through the 38.2
but then it went up a buffer so then it
then did retrace a little but it didn't
make it to the 23.6 level so it went
again through the 38.2 all the way down
to the 50% now it again went past the
38.2 so these levels this seemed to be
an area when the market was trying to
decide what to do
so I went up went down through it and
then went okay I've tried going above
the 50% retracement how about going down
so I went down now it's time to the 61
point 8
it tried to go back up to the 50 but it
easily went back down to the 62 hung
around there a bit so you it went a
little bit below but it went back up to
this level again and then it went
nope I'm not interested in going back up
to 50 it is shut down there now of
course these are levels in this region
so what value does this really add it
does seem to play a role
I mean it's strange that they would this
is the top you know that it does seem to
get it does seem to gravitate to the
Fibonacci levels but it's it's not clear
how exactly we should use it for trading
I would normally think of it as like say
the market goes up to a very high you
know up to this level then it starts
falling then you go okay
I say you believe that bitcoins are
still gonna be going up you know that
this is just a retracement a healthy
retracement you know able to give us
even give us a buying opportunity so one
way to do it is to go I'll put in an
order to buy it at twenty three point
six so that's the earliest retracement
so that's very that's very likely
to be here so you know I can feel pretty
confident that I'll be able to pick that
up but I could get a cheaper normally I
don't use the 23.6 or the 0.786 levels
that much it's more it's more about
fifty percent sixty one point eight and
thirty eight point two so normally if
that was the top I'd look at the recent
the the low and the high and I go I
tried to buy her a 38.2% retracement so
that that's a nice discount you know
that would be pick up some at a good
level otherwise you might want to buy
some at the midpoint in this case it did
fall down and so you would get to buy it
at fifty percent but in many cases you
know when you're in a strong uptrend it
goes up up up up and you never get a
chance to buy it at all
or at a lower level so you know if
you're too picky if you can't go oh no
actually I wanted at a sixty one point
eight percent discount but eight times
out of ten maybe and I'm just making
that number up but was in what most of
the time yeah you it'll never go all the
way down to sixty one point eight so if
you have such a high standard of all and
I wanted a super discount you just
would've missed the OP move so it let's
dip down a little bit and then keep
firing ad so it just gives
nice well-defined levels so that you can
kind of go okay if it jump all the way
up to here I do think that the RSI is
very high now so this is very overbought
so again if you wanted to sell some this
is a good time to the seller if you were
looking at your RSI then I'd be looking
at the fact that the moving average is
well below this so the it should be
automatically attracted back to that
moving average that's the basic trend so
I do want to buy it nearer that trend
price as opposed to paying over the over
the odds so I could look for discount of
38 percent that's more likely I'll have
a good chance of buying it in this case
due to the fact that the RSI was so
extreme and the fact that there were
multiple signs that the price action was
very extended there was a chance there
was a good chance that you'd get a 50%
discount you could say this means that I
should short this you know when it was
up here because I think there's a it's
very extended but it's it's a risky
trade going against the trend
I mean bitcoins have been shooting up
and up and up so you know if you wanted
it bet against it it could cost you a
lot so I I wouldn't be very keen on say
shorting it here you know when it was
way up here because it's still above the
moving average all that old we were
still getting higher highs and our lows
so all the signals are that the trend is
up
and you don't want to bet against the
trend so I'd more be looking for
opportunities to buy more at discount
prices so when it was way up here you
might be looking to buy it a 50 percent
or 61 point 8 then it's very painful as
the price goes down and down and down so
maybe you'd have a stop loss at the 61
point 8 I don't know that's trading you
have to make all these decisions there
are other tools so if you haven't talked
about yet so next time we're gonna look
at candlesticks
see you then
oh and sorry, if you have any questions
remember to just put them in the comments below the videos.
then we can come back to those
Thanks
