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BTC #F Supply
The daily chart above shows our SUPPLY and DEMAND Dashboard and BXB (Bar by Bar) Signals for Bitcoin Futures trading on the Chicago Mercantile Exchange.
Readings are based on Supply and Demand and Volume internal data. It is updated in real time during the regular trading session of the CME exchange and does NOT take into account any price indicators or mathematical formulas using price. We do however show the cumulative price change for the trading session and in some instances assess price movement’s relationship to Supply and Demand. It is therefore fair to say that the readings and signals are independent from other popular price indicators and others shown on the chart. The readings are an independent assessment of the one and only measureable fundamental market mover: SUPPLY and DEMAND. It does not matter if price is influenced by a geopolitical event, seasonality, fundamental economic data releases or sentiment driven news, etc. It all reflects in Supply and Demand, the “footprints” of the “Big Boys” or “Smart Money”.
The first sign of weakness came on April the 27th when Selling pressure developed (Simplified Volume tool) and Supply overcame Demand (Supply/Demand sentiment tool) and price went sideways to down. On April 30th we had a No demand indication on the Wyckoff Wave Volume tool. On May the 2nd a two-day rally occurred which ended on the 4th with Selling pressure increasing and Demand weakening and a Supply reading, signalling Supply overcame demand. We had a sell signal on the 9th (short alignment on the two Dashboards since then).
Daily Signals May the 11th
The Supply and Demand Reading (1st row) was -0.7 which indicates Supply had the upper hand ‘
Supply and Demand Direction (3nd row) was to the downside (red down triangle), indicating downwards direction, with substantial strength.
Average Supply and Demand Volatility (4th row) is above 100% and is bearish. The change in average Volatility from the previous day was negative 6 (supply strengthened) as shown on the right of Sup/Dem Dashboard.
We had a sell signal on the signals board (1st row).
Daily Volatility direction (2nd row) was Down (maroon down triangle). The change in daily Volatility from the previous day was negative 2 (supply strengthened) shown on the right of BXB Dashboard.
Average Volatility direction was Down (maroon down triangle in 3rd row).
Supply / Demand direction was Down (maroon down triangle in 4th row).
In short on April 27th and Selling pressure developed and on May 3rd Demand subsided with a Sell signal on May the 9th. On May 11th the Supply/Demand Sentiment tool went negative on the Daily chart, and Supply has no totally overcame demand. Average Volatility also has increased and all readings and signals point to the down side.
The nearest longer term support level to the down side identified is at the 7805 level and a pull back from here can be expected.
We identified two opportunities on the 11th on the 20-minute chart below:
Strategy is simple, enter when 2 Dashboards align and exit when two opposite triangles on BXB Dashboard appears. Entries and exits are shown with arrows on the chart.
The last sub window on the chart shows the Greed / Fear sentiment measurements of Supply and Demand Sentiment tool. Similar to an Oversold / Overbought situation (but without using price related formulas). Notice how Demand subsided through the session, with a Divergence to the down side resulting in a sell off towards the end of the trading session.
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