Originally posted at: https://coinrule.com/blog/ayo/team/mind-the-gap/ on Sat, 23 Oct 2021 10:40:00 +0000
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The market always fills the gaps.
Gaps are not common in the crypto market. But, as Bitcoin gain mainstream adoption and more investment vehicles get listed on traditional financial markets, these elements can play a relevant role in how its price moves. Gaps signal strong price reversals and point at suitable price levels that traders can use as support and resistance .
The chart shows the Bitcoin future price as it traded on the CME . The gap around $60,000 in April marked the local price top. The price retested immediately the same level after, and when it failed to break out, the trend lost steam and reversed.
The same is happening these days, the other way around. After breaking above, pushing Bitcoin to a new all-time high, the price pulled back to retest the buyers’ confidence. Should the price hold, the road to $100,000 will be smoother.
Be patient. The chart also includes the other three relevant gaps in the market. Keep them in mind as guidance to place your stop losses. Bonus fact, the BTC ETF is already driving up significantly the trading volume , making this chart always more significant from now on.
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