{"id":194647,"date":"2023-08-09T02:26:47","date_gmt":"2023-08-09T06:26:47","guid":{"rendered":"https:\/\/ibkrcampus.com\/?p=194647"},"modified":"2024-01-24T12:12:54","modified_gmt":"2024-01-24T17:12:54","slug":"chart-advisor-bitcoin-makes-the-move","status":"publish","type":"post","link":"https:\/\/www.interactivebrokers.com\/campus\/traders-insight\/securities\/macro\/chart-advisor-bitcoin-makes-the-move\/","title":{"rendered":"Chart Advisor: Bitcoin Makes the Move"},"content":{"rendered":"\n<p>By&nbsp;<a href=\"https:\/\/links.investopedia.com\/u\/click?_t=36ba8fa8372241d58b3bfc06997a4332&amp;_m=586b0bf4448e41908328c24b8b138c66&amp;_e=WX0uqaam2Kd8PWcyQvTr5Sd4PY2hDyx6h5LUy-BJP1mLnlX0_dMCJTQqXgksCRtNcS--XIdSrLVZhdId24-BS7xHeWNcxxLukaEm64PPY53T8ak_U15MArn_bkzZ4MT3pqsyLkPEl-jdVlQeeaGradYnkxTAcI9y0lNisbJn4tD4zjD9W8A0wtXQjHiq7w_rizx9K2q5vDHnT5FbvXAxZahRktjjb8xW5hrugH53zbDXz5qb3TWv6bloNLIOykCr1iK6X5lIAmGTfwZ21BUJ0FRYJb0cCzhcquMa31GfD6aXPQDfps7VXwm5NhtV2Ht677YHwDx3SFS61fTioDSiyjxNA4sn72-3LiObuUm8MXAD_G9R7SRNuN3v7Em7d5SRrK4QU3ZL6tmdoTxBglf88hzQ1qq7YEZ7X9uSGmMe1dQj7XRkIF7kexr67YnPXnX0BlFPAAcgjB1fljr7_xKZrQ%3D%3D\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>J.C. Parets<\/strong><\/a>&nbsp;&amp;&nbsp;<a href=\"https:\/\/links.investopedia.com\/u\/click?_t=36ba8fa8372241d58b3bfc06997a4332&amp;_m=586b0bf4448e41908328c24b8b138c66&amp;_e=WX0uqaam2Kd8PWcyQvTr5WYR_lEEjBV8G3lZWVeS4th7hmdPDWQcroH5xPpCU_v0LP7fsoVtEJThga-nvHtrLoEGPSp8uSVMNvD1HJ66dpR4sbBZUIOCrVERHlWWEjCd1MwCaG36VT5yYYKkoh08DNr3lZpIwilu1P2GvDqkiwp5k8MNd0wgJocbUc3madf80PJ5TgMz7HaXV7n7OiQ0njgS-dsItdgpPBgMKngdhmnRuV0GB_W3WojG3b3GumC_H448dqAA8FwpkhJwupYfibhRR4OHEM63AHUgxmpccUxfcRmjEBbHim92qSFDpa_tTgBfY2H10eT_IfsvdJ91OrLobSm-SqgUa9dUhT9ZbkH62ygffmee9CI7UEBw89iWyATrzKa_axnChYeSWd_rYq-M2chWT8bFedqCHx8homPBgPUEpSw2UqfrfmAjJGgK\" target=\"_blank\" rel=\"noreferrer noopener\"><strong>All Star Charts<\/strong><\/a><\/p>\n\n\n\n<p><strong>1\/ Bitcoin Makes the Move<\/strong><\/p>\n\n\n\n<p><strong>2\/ Homebuilders Hit Resistance<\/strong><\/p>\n\n\n\n<p><strong>3\/ High Beta Is Getting Halted<\/strong><\/p>\n\n\n\n<p><strong>4\/ Time for Utilities to Outperform?<\/strong><\/p>\n\n\n\n<p><em>Investopedia is partnering with All Star Charts on this newsletter, which both sells its research to investors, and may trade or hold positions in securities mentioned herein. The contents of this newsletter are for informational and educational purposes only, however, and do not constitute investing advice.<\/em><\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-1-bitcoin-makes-the-move\">1\/ <strong>Bitcoin Makes the Move<\/strong><\/h2>\n\n\n\n<p>After a prolonged nap,&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/b\/bitcoin.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">Bitcoin<\/a>&nbsp;(<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=btcusd&amp;hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">BTC\/USD<\/a>) bulls seem to be back, ready to take control.<\/p>\n\n\n\n<p>As you can see, after Bitcoin briefly violated the lower bounds of a&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/f\/failedbreak.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">flag pattern<\/a>&nbsp;last month, buyers stepped in and reclaimed this support level today, resulting in a potential&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/f\/failedbreak.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">failed breakdown<\/a>.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/08\/1-9-1100x541.png\" alt=\"\" class=\"wp-image-194648 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>It is not the first time we have seen this type of shakeout in BTC this year. As happened in Q1 and Q2, the price reversed higher after BTC put&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/b\/beartrap.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">bear traps<\/a>&nbsp;on the road.<\/p>\n\n\n\n<p>If buyers push prices above $30,000 in the coming two days, we could see a swift reaction to the upside.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-2-homebuilders-hit-resistance\">2\/ <strong>Homebuilders Hit Resistance<\/strong><\/h2>\n\n\n\n<p>Major U.S.&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/i\/index.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">indexes<\/a>&nbsp;like the S&amp;P 500 and the Nasdaq 100 ran into overhead supply and have halted their recent advance.<\/p>\n\n\n\n<p>When we dive beneath the surface, we\u2019re seeing similar behavior at an industry level.<\/p>\n\n\n\n<p>As you can see, the S&amp;P Homebuilders ETF (<a href=\"https:\/\/www.investopedia.com\/terms\/r\/resistance.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">XHB<\/a>) is back at all-time high&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/resistance.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">resistance<\/a>.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/08\/2-6-1100x541.png\" alt=\"\" class=\"wp-image-194649 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>The action in XHB shows that it isn\u2019t just large-cap tech that is due for a pause, but other areas in the market as well.<br><br>Taking a look at the 14-period&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/rsi.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">relative strength index (RSI)<\/a>&nbsp;shows a bearish RSI&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/d\/divergence.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">divergence<\/a>, which supports the case for a pause.<\/p>\n\n\n\n<p>As long as the price is below $86, we might see some sideways action for XHB in the foreseeable future. However, a break above this area of interest would likely mean a fresh leg higher for XHB.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-3-high-beta-is-getting-halted\">3\/ <strong>High Beta Is Getting Halted<\/strong><\/h2>\n\n\n\n<p>One of our favorite metrics for gauging risk appetite is through the high beta (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=sphb&amp;hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">SPHB<\/a>) vs. low volatility (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=splv&amp;hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">SPLV<\/a>) ratio.<\/p>\n\n\n\n<p>Long story short, when SPHB\/SPLV trends higher, investors favor riskier stocks over their alternatives. The opposite is true when this ratio points lower, suggesting an environment conducive to broad market selling pressure.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/08\/3-6-1100x541.png\" alt=\"\" class=\"wp-image-194650 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>As you can see in the above chart, high-<a href=\"https:\/\/www.investopedia.com\/terms\/b\/beta.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">beta<\/a>&nbsp;stocks are getting halted at a shelf of former highs versus their low-volatility counterparts.<\/p>\n\n\n\n<p>Notice also that the 14-period RSI is printing in a bearish divergence, suggesting that a&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/c\/correction.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">correction<\/a>&nbsp;may be coming.<\/p>\n\n\n\n<p>Bulls likely want to see a decisive breakout from this multi-year base, as it would suggest a&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/risk-on-risk-off.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">risk-on<\/a>&nbsp;tone for the market.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\" id=\"h-4-time-for-utilities-to-outperform\">4\/ <strong>Time for Utilities to Outperform?<\/strong><\/h2>\n\n\n\n<p>Regarding some of the most&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/d\/defensivestock.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">defensive sectors<\/a>, utilities (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=xlu&amp;hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">XLU<\/a>) are back at the lows from 2021 relative to the S&amp;P 500 (<a href=\"https:\/\/www.investopedia.com\/markets\/quote?tvwidgetsymbol=spy&amp;hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">SPY<\/a>).<\/p>\n\n\n\n<p>Outperformance from these stocks is not something we tend to see during bull markets, as it is evidence of risk aversion, not risk-seeking behavior.<\/p>\n\n\n\n<figure class=\"wp-block-image size-large\"><img decoding=\"async\" data-src=\"\/campus\/wp-content\/uploads\/sites\/2\/2023\/08\/4-5-1100x541.png\" alt=\"\" class=\"wp-image-194651 lazyload\" src=\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\" style=\"--smush-placeholder-width: 1100px; aspect-ratio: 1100\/541;\" \/><\/figure>\n\n\n\n<p>As you can see in the lower pane,&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/m\/momentum.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">momentum<\/a>&nbsp;is printing a potential bullish divergence, making higher lows despite the lower lows in the ratio.<\/p>\n\n\n\n<p>If there\u2019s a time and place for these defensive stocks to assume some leadership, this is it.<\/p>\n\n\n\n<p>Bulls probably do not want to see this ratio rise, as it would tell us that investors are positioning for tough times ahead. Conversely, a break through this&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/s\/support.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">support level<\/a>&nbsp;would be a big positive for&nbsp;<a href=\"https:\/\/www.investopedia.com\/terms\/r\/risk-asset.asp?hid=52e0514b725a58fa5560211dfc847e5115778175&amp;did=9916040-20230809&amp;utm_campaign=chart-advisor_newsletter&amp;utm_source=investopedia&amp;utm_medium=email&amp;utm_content=080923\" target=\"_blank\" rel=\"noreferrer noopener\">risk assets<\/a>.<\/p>\n\n\n\n<p>&#8212;<\/p>\n\n\n\n<p>Originally posted 8th August 2023<\/p>\n","protected":false},"excerpt":{"rendered":"<p>After a prolonged nap, Bitcoin (BTC\/USD) bulls seem to be back, ready to take control.<\/p>\n","protected":false},"author":186,"featured_media":0,"comment_status":"open","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[14,18,6,9,22,23,26,3],"tags":[8083,445,910,9299,3154,262,670,1323],"contributors-categories":[13686],"class_list":{"0":"post-194647","1":"post","2":"type-post","3":"status-publish","4":"format-standard","6":"category-etfs","7":"category-macro","8":"category-north-america","9":"category-securities","10":"category-stocks","11":"category-technical-analysis","12":"category-text-articles","13":"category-traders-insight","14":"tag-btcusd","15":"tag-rsi","16":"tag-sp-500","17":"tag-sphb","18":"tag-splv","19":"tag-spy","20":"tag-xhb","21":"tag-xlu","22":"contributors-categories-investopedia"},"pp_statuses_selecting_workflow":false,"pp_workflow_action":"current","pp_status_selection":"publish","acf":[],"yoast_head":"<!-- This site is optimized with the Yoast SEO Premium 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