Bitcoin, eighty percent rule based

Our market participation process is over 80% rule based. These rules are defined to the smallest detail. This scrutiny is necessary so that the mind does not access intuitive decisions in principle wrong in a counterintuitive environment under stress. Stress situations are always inherently present in the market. Either you are stressed not knowing the answer to a question since you do not have a rule, or you get time squeezed towards an entry, or exit since your action (pressing a button) is just a millisecond, but time is ticking. Bitcoin, eighty percent rule based.

In short, what to do and when to do it is leveraged since you make a sizeable money bet, and your typical resource for such stress (e.g. intuition) is not just worthless but the worst choice in a counterintuitive environment. In addition, we use a tool called “the daily call” to plan ahead. The daily call is a strategy planning outside trading hours to gauge the market and lay strict rules of “what not to do” to reduce losing trades.

It is these refined rule structures and plans that allow us to always stay calm when Bitcoin trades with its volatility nerve-racking around turning points for the unprepared. We see little alternative to catch important low-risk entry points for long-term trades like the one coming up right now for this digital currency.

BTC-USD, Daily Chart, What happened since last week?

Bitcoin in US-Dollar, daily chart as of June 29th, 2021.

Opportunities are plentiful when it comes to Bitcoin. Which makes this sequenced rule-based behavior especially necessary. Our last weekly chartbook publication posted the chart above (left side with grey background). Less than 48 hours after publication, the assumed scenario manifested. It was this precise planning that allowed us an entry at US$29,176.3. We took half of the position off at US$31,804.3. Therefore, eliminated risk and locked in some partial profits (see our quad strategy). This trading method allowed for stress-free observation of the quick retest of lows following with wiggle room for the stop level. It isn’t clear if this was the ultimate turning point in this sideways zone that Bitcoin is trading right now. More likely than not, one of our efforts grabbing the lows of this range might succeed. If not, income-producing partial profit-taking pays for our efforts.

BTC-USD, Weekly Chart, Long term entry validation:

Bitcoin in US-Dollar, weekly chart as of June 29th, 2021.

A weekly chart analysis grants a view that monthly/yearly charts have now a confirmed weekly entry setup. Present is a low-risk long entry with lower price rejections set (see wicks in yellow ellipse). We would aim in more partial profit taking slightly below recent all-time highs. We would expect these highs to give way for prices to climb much higher.

BTC-USD, Monthly Chart, And the winner is:

Bitcoin in US-Dollar, monthly chart as of June 29th, 2021.

It is an incredible feat to time, no matter how high a timeframe, a millisecond entry of a push of a button which might have significant effects on your future, and consequences materialize years from that little action of your finger. Such steps are far removed from a typical task where you shovel a hole in the ground and see with each stroke of the spate your results in real-time. In the familiar environment, cognitive aspects are aligned with intuitive physical behavior.

But it isn’t the ‘doing’ that gets you rich in the markets, but rather good planning, little work, and lots of patience. Due to these circumstances, it is imperative to always look at the larger timeframes. This will create a much broader perspective and will help to not get lost in the casualties of Bitcoin´s daily volatility. Temptations that easily lure one in for overtrading.

Observing the monthly chart, we find beauty in its simplicity. Prices trade above the 50% Fibonacci retracement level. Fractal volume analysis in addition grants support. And with this month nearly closing, we seem to be having two months showing wicks to the downside rejecting lower price levels. To us a setup for taking a low-risk entry at the beginning of July. Given that present levels hold till the end of the second quarter.

If prices decline sharply before month’s end, all bets are off.

You will find confirmations within our free Telegram channel, where we post all our market entries and exits in real-time. Rarely do stars align that nicely, yet we have found the mind again playing tricks, especially for easy trades. Without a precise rule-based sequence and detailed entry and exit planning, human errors are guaranteed.

Why is it eighty percent and not a hundred? The market has too many variables to be tamed by a purely left-brained approach. It requires experience (=screen time), creativity, and some thinking outside the box to make the market give up profits consistently to the trader.

Bitcoin, eighty percent rule-based:

Why a tightly knitted web of rules is necessary is to be able to execute one’s plan. Have you ever wondered why you ran a stop or, numerous times in a row, betrayed your own plan? Simple! When too many question marks arise within the flow to commit to trade by actually pressing the button, it gets harder and harder to pull the trigger. Conflicts are eating away confidence. There is a necessity of a clear, sequenced rule-based event chain to act without hesitation consistently.

We found that a well-rehearsed scenario with clarity to act in your own best interest is one way to step into this field of uncertainty and repeatedly act on your plan. The alternative is a bad relationship between a well-developed edge and the ability to act upon these edges. Most of the time, this causes human errors. Consequently, the edge is mitigated to that extent that one consistently loses money.

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All published information represents the opinion and analysis of Mr Korbinian Koller & his partners, based on data available to him, at the time of writing. Mr. Koller’s opinions are his own and are not a recommendation or an offer to buy or sell securities. Mr. Koller is an independent analyst who receives no compensation of any kind from any groups, individuals or corporations. As trading and investing in any financial markets may involve serious risk of loss, Mr. Koller recommends that you consult with a qualified investment advisor, one licensed by appropriate regulatory agencies in your legal jurisdiction and do your own due diligence and research when making any kind of a transaction with financial ramifications.

Although a qualified and experienced stock market analyst, Korbinian Koller is not a Registered Securities Advisor. Therefore Mr. Koller’s opinions on the market and stocks can only be construed as a solicitation to buy and sell securities when they are subject to the prior approval and endorsement of a Registered Securities Advisor operating in accordance with the appropriate regulations in your area of jurisdiction. Past results are not necessarily indicative of future results. The passing on and reproduction of this report, analysis or information within the membership area is only legal with a written permission of the author.

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