Bitcoin price has fallen away from the highs of Thursday and Friday and is being drawn back to critical support just above $230. Will price bounce or will it return to the week’s lows?
Bitcoin Price Analysis
Time of analysis: 15h44 UTC
Bitfinex 1-Hour Chart
From the analysis pages of xbt.social, earlier today:
The outlook is bearish at the 6hr and 12hr timeframes and thanks to xbt.social member santana for his multi-chart analysis. As the smaller timeframe analysis below shows there is still time and chart space for market shenanigans before decline becomes a “definite”.
Supplementing the larger timeframe analysis, we should prepare for a breach or bounce at the 1-hour and 4-hour 200MA. Both have been holding approximately the same level – the purple 800MA in the above 1-hour chart is equivalent to the 4-hour chart’s 200MA.
Price, today, declined into oversold conditions and also reverse divergence in the momentum indicators. This has put the brakes on decline for a while. Additionally, the presence of both the 1-hour and 4-hour 200MA at the same level, should have the market consolidate above these MA’s before dropping through into decline – similar to (but possibly larger than) the consolidation that occurred from 18-21 September.
Currently, the bias is bearish at all timeframes. The weekly timeframe has price clinging to the 200-week moving average and a drop away from this level could be strong. However, amid all this bearish talk, bear in mind the pattern analysis presented in earlier updates: price may only get as far as $210 or $200 before reversing. Anything stronger will have to consolidate at one of these support levels before drawing more red candles.
In the stockmarket – time is not money – time is time and money is money. Often money that is just sitting can later be moved into the right situation at the right time and make a vast fortune – patience – patience. – Jesse Livermore
Traders are advised to wait for the consolidation above the 1-hour and 4-hour 200MA before opening what looks like a sure sell position. The market has been unpredictable and volatility often manifests at turning points. From the current position price may drop or it may bounce. Two bellwether moving averages, in different timeframes, are only a couple of dollars below price and speculators should allow these to confirm immediate trend. Make allowance for a surprise bounce when price first reaches critical support.
Bitfinex orderbook depth and Buy/Sell Volume:
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Bitcoin price charts from TradingView.
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