Bitcoin Price Analyses Feb-10 2016

Over the past 2 weeks, the price of bitcoin has been choppy at best, oscillating within a range defined by sell off from $450 to $352 over 5 days, January 10 – January 15. Since then, this range seems to be narrowing towards an apex, in what looks to be a triangular pattern approaching a break out point (more on this later). There is a good chance this goes on for a couple of more weeks, before a decisive move in March.

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The real winners have been intraday traders, who have been longing and shorting these tight trading range on leverage. The short term movement is indecisive, and warrants zooming out on a larger time frame, the 1 week chart for a better glimpse. Here, (1) and (2) sloping trend lines shown below, are indicative of hanging on the balance.

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Price is hugging trendline (2) current support. (1) is the next target level if $352 fails to hold, opening up price falls to as low as $330- $300.

With 160 days left to the reward halving in July, there is plenty of room for another leg up to $600, in the event of a speculative bubble. How price behaves within (3) rectangle should confirm a resumption of the upward trend from January 2015 $152 low. Ideally, any low on either trendline is to find firm support for a launch to $600.

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So, will price hold above $352?

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Seen above, candlesticks oscillate around 100 day and 50 day Exponential moving average lines as a mean. Both converging on the weekly at $330 are great support for any bounce up to higher targets. Before this, 100 day EMA on the 3day, where price currently hangs on a would have to fail first, seen below. A double bottom here like the double in July – August 2015 forms a solid launch pad.

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I am watching this triangle below for now. Moving up convincingly from this level to $420 to complete this formation.

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This symmetrical type of triangle pattern is commonly grouped as a continuation patterns. Patterns that signal a consolidation period within a trend, followed by a resumption of the prior trend.

Watch for a break out followed by increase in volume in the direction of the breakout.

Ethers’ surges to $3.76 high

While Bitcoin’s price has been suppressed by woes on block size limits and consensus deadlocks, R3CEV recent announcement to use Ethereum, and all the accompanying speculation has been bullish for the price of Ether. On 9th February 2016, Ether was up 120% from 2 weeks ago, a high at $3.76 per Ether.

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Ether’s price soar could go higher, as the market attention shifts to it. While it could go higher, it is dangerous to buy at current levels, in what looks to be the top of a pump period.

I think this bubble is gonna pop somehow even if ETH is for real. Now, there’s a slight chance that ETH will be better than BTC”

Naturally, comparisons to Bitcoin are making rounds. A tweet from George Hallam

Just 4 months after release, Ethereum already has ~1/4 the number of nodes on the bitcoin network (1354/5712)”

Blockstream secures $55 million to Commercialize Bitcoin Blockchain

The hype around blockchains in 2015, ramped up funding for private blockchain projects by large commercial banks. Blockstream, a startup with some of the best cryptographic money veterans, intends to commercialize Bitcoin’s Blockchain for all. That includes a spectrum of users from individuals to large financial institutions such as PWC. Right after announcing a strategic partnership with the big 4 audit consultancy firm, CEO Austin Hill announced their $55 million series A funding round.
Hill was bullish on interoperable blockchains and Bitcoin’s long term potential saying to Coindesk he believes

bitcoin’s code base will become widely used, even by private or permissioned blockchain solutions due to its proven functionality.”

Commonwealth Urges Members to legally recognize virtual currencies

A Virtual Currencies Working Group for the 53 member body concluded a report by calling for member nations to legislate rules around use of VCs such as bitcoin as per Cryptocoins news.
Kenya’s Central Bank for instance, a member country from East Africa, made a public notice in December 2015 urging caution by the public while highlighting bitcoin’s undefined status as per the law.

For such a country, the report

calls for such regulatory authorities to seek its applicability in existing legislative frameworks.”

Bitcoin Weekly Price Forecast

This week I am neutral to bullish. I see price making a retrace back to $450, but not before settling on a firm support for a launch. This could be current levels at $350 or slightly lower at $330. Price may well continue trading in a narrow range sideways, and before a decision.

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I am still watching this medium chart forecast that has been pretty accurate up to now. The effect of halving speculation should take us to a B top in over the coming months. Encircled is where we are at right now.

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