Welcome to the weekly edition of the CoinDesk Markets newsletter!
Every Friday we will review our cryptocurrency price predictions posted during the week via CoinDesk Markets Twitter or our private room on StockTwits, the CoinDesk Dojo.
"Trades You Missed" will feature our favorite trade ideas or technical analysis insights that accomplished impressive gains, where as "Trades We Missed" will feature those that took a turn for the worse.
Wins and losses are both part of the trading game, so we hope you will learn how to replicate our successes and minimize losses!
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Bitcoin Traps Sellers
BTC/USD : Price: $10,320 | MCAP: $185 Billion | Maximum Gain: +3.92%
Why we were intrigued:
Bitcoin was on the back foot on Wednesday, having dropped to lows near $9,850 after witnessing strong rejection near Aug. 20's bearish lower high of $10,956 last Friday.
The pullback, however, lacked substance, meaning trading volumes had dropped along with the price. A low-volume pullback occurs due to unwinding of weak longs and is often short-lived.
Hence, the drop to levels below $10,000 was a buying opportunity – more so, as a long-tailed doji candle appeared on the 4-hour chart on Wednesday. Further, the correction had taken the shape of a falling wedge, a bullish reversal pattern.
Hence, on Wednesday, a long call was initiated for a target of $10,500. The bullish trade idea was shared on CoinDeskDojo when the cryptocurrency was changing hands at $10,070.
As expected, BTC broke higher from the falling wedge on Thursday and narrowly missed our target by printing a high of $10,465 earlier today.
As of writing, the cryptocurrency is trading above $10,300, The $165 price drop seen in the last few hours has done no damage to the bullish technical setup on the 4-hour chart and the cryptocurrency looks set to revisit recent highs above $10,900.
Note that falling wedge breakouts usually fuels a price move to the apex – the price seen at the beginning of the falling wedge.
Read: Bitcoin Eyes Move to $10,950 Hurdle After Price Breakout
The Trade
The Result
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Verge Drops After Teasing Bull Reversal
XVG/BTC: Price: 41 sats | MCAP: 6,606 BTC | Maximum Loss: -6.5%
Why we were intrigued:
Verge (XVG) confirmed a bullish breakout on Sept. 9, but, so far, the follow-through has been dismal.
The cryptocurrency jumped 9.52 percent on Monday, violating the resistance of the trendline connecting Aug. 18 and Aug. 25 highs. The breakout was also accompanied by surge in buying volumes to the highest level in over two weeks.
Further, on Tuesday, the moving average convergence divergence histogram crossed above zero, confirming a bullish reversal.
All-in-all, XVG looking primed for a bullish move to 50 sats. So, on Tuesday, a buy call was initiated when the cryptocurrency was trading at 46 sats.
However, the bullish view failed and the cryptocurrency fell back below 43.00 on Wednesday, triggering our stop loss. The rise in BTC/USD again played a spoilsport.
The pullback has neutralized the immediate bullish outlook. The outlook would turn bearish if prices find acceptance below the August low of 38 sats. On the higher side, a UTC close above 47 sats is needed to revive the bullish setup.
The Trade
The Result
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|  We're excited to announce the launch of the CoinDesk Dojo, a premium subscription part of StockTwits' recently announced Premium Rooms product. Ask the analysts—Omkar, Sam and Seb—questions about charts and talk with other traders looking to profit off the volatility of the crypto markets. Create an account on StockTwits and then subscribe! Subscribe Here |
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| Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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Trading Bear Traps