What's going on everyone? My name is nicholas merton here at datadash and today is november 26 of 2020. Well folks, i hope you are having a fantastic day wherever you are, and in today's, video. I want to spend some time to talk about today's price action, because if you're, looking at the charts today, we're, seeing what is probably the first major downward move in the last two to three months.
It's, in fact, a complete denomination from everything we've, seen in crypto markets and it doesn't matter. If you're, holding bitcoin or altcoins, you're, probably seeing a big loss for today for the most part now for those of you who are here for the first time encrypted.
This is your first time investing or for some of you who are more seasoned investors who have been with me. Maybe all the way up to the last three years that i've been doing youtube. I want to spend some time to say it's.
Nothing to panic about this is common in cryptocurrency markets. I'm, going to spend some time today to talk about not only how we can use longer term time frames to spot when bitcoin is going to react a certain way at any given period of time in its cycle.
But, along with that as well, i want to put my money where my mouth is. I haven't been selling any of my positions. I haven't been taking any profit. If anything i've actually been averaging in. I just made a deposit this morning that i'm, hoping to add into some of my major positions, so again very excited to continue looking forward to the future and let me go ahead and dive straight into it.
So the first thing i want to talk about here guys that i think is very critical in this lesson that i want to share today is taking a look at this chart here right. So we're, taking a look at bitcoin here, uh, probably the most well-known cryptocurrency.
By far, we said in a relative peak here at 19500 and had a decline all the way down to sixteen thousand two hundred now, a lot of people are gonna panic and to be fair, it's, a pretty stark decline. In fact, it's, far off from what we've, seen to the upside over the last few weeks, it's, a complete denomination.
We haven't seen a south side move like this in some time. Since all the way back in september, and when you see something go down 10, you know for many people who probably bought during this time period, and now you're in the red.
I can understand how that could cause some kind of fear. However, let me go ahead and actually spend some time to teach a very, very important lesson here now. What we're taking a look at here is something that i would say, probably 90 percent of traders.
Maybe even 95 percent will never, and i mean never. They will never look at this chart. They may even look at candle charts like we're, looking at where you're, seeing the upward and downward movement.
But they're more likely to look at the five-minute chart, much more likely than they are to look at this chart now. What is this trade? This is the monthly chart. So each of these candles represents a month's worth of price section.
Everything you've, heard seen and experienced here in november of 2020 is within this candle here, all the fomo, all the excitement, the move from initially starting at the beginning of the month, around a little bit below 14k.
Nearly all the way up to almost 20k all happened in this month. Now that's, not really my point here. What i want to focus here on is how we can learn from history. Have we seen this before? Could we have predicted this to some capacity? Well, i'm going to say it was a bit humbled, because i did this exact same thing earlier on that i tend to do from time to time, and sometimes you catch it.
Sometimes you don't. A lot of people were anticipating that we would get up here. Maybe have a smaller correction here, but in fact history actually showed us something different. What we're going to do is switch to the log scale.
Chart of the logarithmic chart - and this is going to give us a much easier read on previous price action in the past. So let's. Take a look here, so we & # 39. Ve obviously got our peak here at 20k bottom here at 3k and then our retest close up just 500 bucks away from the even number of 20 000.
, even actually closer uh. You know because we didn't actually set officially 20k at the highs. It was right below it, so we actually got even closer in this case to our previous highs. Let's. Take a look at the previous cycle here.
What did we experience before? We actually broke to all-time highs? Well, we actually saw in this case three months of general sideways consolidation and, along with that, more specifically, when we got extremely close to these highs, like we just did recently on this cycle, we actually saw a pretty stark correction: let's, go ahead And dive into a slightly shorter time frame here we're, going to go to the weekly chart and we're, going to go back to that cycle there, because it & # 39, ll adjust the chart.
And what do you know? We actually had two times here, for example, all the way up here to a high of eleven thousand uh. Sorry, you said one thousand one hundred thirty nine dollars downward towards seven hundred fifty three dollars.
If we go ahead, we can actually use this tool called the date and price range tool go ahead from that top draw to the bottom. And what do you know? We actually had a 33.86 correction. It might not seem like much right.
It might not seem like a lot here in the sense of like oh it's only going from 11 000 to 700.. It's, not like going from 19 000 to 16 000. Well, actually, it's actually worse. In this case, percentage-wise, this is a worse decline and the crazy thing is is it happened in less than two weeks? In fact, if we go here to the daily chart, diving in a bit deeper sorry guys, the training viewers will readjust the time frames here back to a more relative time frame.
This happened actually, unless, if we get these specifics here less than six days, not even a whole week, we've. Seen this before and history tells us anything we're going to recover, have buyers come in to buy the dip, and we're, going to experience it again, even breaking out above those all-time highs.
We're, going to possibly come back down, but here's. The catch here guys here's. The important thing to focus on what you want to focus on is that, above all, did we hold the vast majority of our gains? Yes, did we generally hold the broader long-term line of support? Did we set in a higher low here and a higher high? Yes, we did all of those things as we continue through, and that is what gave us the confidence as we broke further and further away from those all-time highs.
Where this dotted line is indicating right, we need to stretch it across here, the more more we broke away from that. The signal was clear that the previous bubble was a bump in the road. It was a part of the journey for bitcoin and that's.
Why we climbed all the way to 20k, and now we are recouping back up here, close to 20k again so the conclusion here, let's, go ahead and take a look at the percentage decline from top to bottom. You know roughly speaking 16 and a half percent, probably speaking, this is nowhere near as bad as what we've seen before folks.
This is something that bitcoin has gone through time and time again and to be fair, it'll, probably come down somewhere towards around 20 percent. In fact, this was a previous resistance and support range.
It's very likely. It could do that and, along with that, 15 600, not a bad price, slowly recover back up going into december, and this again kind of plays in to something that i was keeping wary of in a sense.
As you all know, who have been watching the channel for some time, i've, said q1 of 2021. Constantly is kind of my general uh kind of time. Reference for actually breaking above all-time highs, doesn't mean that bitcoin can't come back up here, close to 20k and range around.
Here. I'm, not saying it's going to sell off like crazy. I'm, just saying that i might hold around this range and i have no doubt during this time period. All quinns are going to really start to get some of that liquidity coming into a lot of them and seeing their prices increase.
We saw this last time now. One thing that i want to emphasize here is that, no matter if your position in bitcoin are all coins, you want to position yourself in the market leaders here and one of the market leaders that i've been holding into right now is amplifor.
Now amplified this one that i've beat like a drum. I've talked about it constantly here on the channel, but this one has been holding up phenomenally. Well. Not only has it been increasing since back here in october, recouping actually some of the losses that i had when i built my position back here in early september, but along with that, it's continued to climb up here and keep up with bitcoin.
Since all the way back here in september, we were actually holding relatively neutral and sideways, but what we've done is actually continuously set in higher lows and higher highs. We actually just closed slightly above this previous line of resistance, and now it's, just a matter of discontinuing to climb a bit more and keeping up with bitcoin i like plays that keep up with bitcoin constantly, if not outpace bitcoin.
You have to follow the leaders on the market that are showcasing strength, and if you can do that, then you'll come out on top for certain in the long run, no matter if you're in the peak of an all Coin cycle or just getting started, you want to constantly see whether or not your plays are outpacing the big dogs, bitcoin, ethereum, etc.
Okay, so this is again just an important lesson here i'm, not really saying you should go and buy amp before i'm just saying in this case it's, a great example of how you should analyze charts Here notice, how i'm, not using any crazy amount of indicators.
If you're looking to trade guys, you can always check out my trading tips series. It's, a great place to start and learning how to use some indicators. Things like the fibonacci, retracements et cetera, but really in the long run guys there's, no need to overcomplicate.
It look at longer term time. Frames, analyze previous history and focus on support and resistance, those higher highs and higher lows that's; a signal of a trend reversal after a correction that's, signaling higher price moves, and one last thing as well just wanted to talk Because i know some people are worried about ethereum.
Ethereum is actually well probably what i'm, going to be picking up some today, as we're coming down and testing on support here from previous resistance. This is where we had the secondary phase of the breakout, and you all know in this case i like to buy when we retest previous resistance and make it support.
So ethereum is probably going to be one. We'll, be buying today, not 100. Certain uh might be buying into more altcoins like ample four things of this sort. Who knows we're gonna have to see, but, above all, everyone.
I hope you're having a fantastic day wherever you are don't fret too hard about the market go enjoy the holidays with your family and friends, and i & # 39. Ll see you all in the next video, but before that, if you guys can i want to ask of two things: real quick if you could like and subscribe if you haven't already and along with that, if you're trying To get your family into crypto right, if you want to bring up the conversation, if you want to come across as the crazy family member well, you would have been crazier probably a couple weeks ago, but now everyone's, going to probably be asking You about bitcoin and cryptocurrencies such as, if they do ask you about it or you want to share it with them, get them started right and share with them favorite cryptocurrency application years.
I recommend the app we've built just digifox, so you guys can uh share it with them. It's, a great way to get started in crypto. They can earn interest one of the best ways that i kind of introduce people to it is uh through stable coins.
Actually through earning interest right now, you can earn 10 interest on digifox through our partners celsius. So again, i highly recommend guys give it a chance. Give it a try and uh again bring one or two family members on no matter if using digital, fox and stuff just introduce them to crypto, get them started, hey they got a discount, so it's, a good opportunity, all right all right.
Everyone have a fantastic day enjoy the holidays. If you're celebrating it and i'll see you all in the next video take care. Everyone