Trader outlines odds of Bitcoin retesting the $20,000 level reached in 2017

A practising trader and founder of the Crypto Mentors project, Nikita Semov, discusses the current market situation.

Price Action and VSA

Distribution before us, or a reaccumulation for continuation of the trend? Let’s work it out. Those who studied Richard Wyckoff’s works know well that the trader himself never drew such schemes in his life. Neither in ‘Studies in Tape Reading’, nor in the later edition ‘The Day Trader’s Bible’, nor in ‘The Method of Trading and Investing in Stocks’, and even in his articles in journals, there are no such patterns.

Their formalisation based on the VSA methodology is more the achievement of Wyckoff’s students. Nevertheless, accumulation and distribution patterns work remarkably well, indicating the direction of position buildup by a large player within the range.

Currently the scheme is most similar to distribution, which may point to asset unloading and an impending correction. Whether this scheme will be confirmed is unknown, as for now there is only a coincidence of phase ‘A’ and 1/2 ‘B’, but just in case this should be taken into account.

In the context of Price Action and VSA there is a clearly flat range with well-defined Creek and Ice boundaries, within which work will be conducted until balance exits. At the top is a clear liquidity pool, which will certainly be used as intended.

Analysis of Horizontal Volumes and Deltas

As was said, the primary objective for establishing the position was $18,300. At present, a balance is forming, the lower boundary of which was formed by substantial thrust-volume arrays [1]. In the upper part of the balance, though we do see a spike in volumes [2], it is not abnormal, thus it does not qualify as a fixation.

Given the anchoring to the POC of the balance and the formation of a tightening pattern, a move upward and a unwind from this accumulation are expected. The approximate target is $20,000.

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