Now, should we go long or short on Bitcoin?
[From the perspective of candlestick analysis]
The chart below shows Bitcoin's 4-hour candlestick chart. The current structure is particularly simple.
Around $94,800 is the resistance level above. Around $83,700 is the support level below.
Currently, it's a classic range-bound state, a pattern that could be used as a textbook example in technical analysis.
According to the basic principles of trading based on candlesticks, avoid random predictions and follow the trend.
Therefore, avoid heavy positions in either long or short. Small positions for short-term trades are acceptable.
Moreover, from January 3rd to now, it has been a downtrend. So, for short-term intraday trading, shorting is preferred.
However, from a longer time frame perspective, Bitcoin has fallen from $126,000 and has been ranging for one and a half months. If it were a downtrend, it wouldn't have been ranging for so long in the middle. Thus, $80,000 is a diamond bottom. From a long-term investment standpoint, buying Bitcoin now is appropriate.
[From the macroeconomic perspective]
Expectations of Federal Reserve rate cuts and the initiation of quantitative easing. Investment funds are allocating new annual capital into equities, with some funds flowing into Bitcoin ETFs. JPMorgan has applied for a cryptocurrency fund.
[Conclusion]
For short-term trading, avoid heavy long or short positions. For long-term investment with low leverage, buying and holding is acceptable.
