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The bitcoin price chart surged higher over the weekend as bullish trade easily scaled the order books during low liquidity. The $100 distance from $580 to $680 (Bitstamp) was easily achieved within 48 hours. Technical analysis shows more advance is in store.
Bitcoin Price Analysis
Time of analysis: 11h00 UTC
Bitstamp 1-Day Candle Chart
From the analysis pages of xbt.social, earlier today:
A steady untiring wave of advance has propelled bitcoin price to the $680 zone where the advance has slowed, although not stopped in many exchange charts. At the time of writing the CNY exchange charts are bobbing above 4700 CNY; the popular USD exchanges hold around $680 (after attempting $700 earlier today) and the OKCoin September futures contract has scaled $750.
The daily price chart shows that price has advanced straight through a contention zone (pale blue) wherein price had not only vacillated during the 2014 decline, but through which price had made a $380 correction on the way up during November 2013. A correction of this size is unlikely at the present juncture because the price wave is advancing amid less volatility.
Given the uninterrupted push higher, we could expect price to consolidate above the blue zone, or to perhaps fall back into the zone and build energy for the next push higher. Despite a peaking RSI indicator (magenta circle) additional advance is implied by a lack of RSI divergence – the size of an intervening correction, or consolidation is uncertain, however.
If buying remains relentless and the profit-takers hold off, then a push to the $750 level (and 5000 CNY) would not surprise. Holding throughout the advance requires nerves of steel – knowing when to get off the bus requires a method. xbt.social subscribers remain in the trade and will take profit only on specific technical conditions that catch the bulk of each advancing price wave.
To anticipate the market is to gamble. To be patient and react only when the market gives the signal is to speculate. – Jesse Livermore
Now that price has achieved a level last seen more than two years ago, the market is exuberant and strong buying may continue. Certainly, no one in their right mind could be bearish toward bitcoin now, but this does not rule out bouts of profit taking and subsequent price correction. We keep an eye on the $680 level (Bitstamp) for support.
Bitfinex Depth Chart and Buy/Sell Volume
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Readers can follow Bitcoin price analysis updates every day on CCN.LA. A Global Economic Outlook report is published every Monday.
The writer trades Bitcoin. Trade and Investment is risky. CCN.LA accepts no liability for losses incurred as a result of anything written in this Bitcoin price analysis report.
Bitcoin price charts from TradingView.
Image from Shutterstock.