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Bitcoin Price Holds Above $550 Support

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Bitcoin price has halted decline and may have found support at the $555 (Bitstamp) level. The 4-hour candle chart shows that advance is possible, but that a critical watershed for decline remains close-by.

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Bitcoin Price Analysis

Time of analysis: 13h00 UTC Thursday

Bitstamp 4-Hour Candle Chart

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From the analysis pages of xbt.social, earlier today:

Price action has stopped making lower lows – for now – and we’re yet to see a series of higher highs. It’s too early to discard the notion of additional decline since the past day’s upside pattern may only be an upward correction. While we wait for the chart to develop further, let’s consider intermediate trend in the 4hr hour chart.

I had mentioned, prior to the drop from $650, that a large decline would emulate the pattern of the decline that setup the June rally. August’s price action seems to be continuing in line with the idea of a resumption of advance.

4-hour MACD (top) has worked its way closer to its zero line and could cross over within a few days if price continues advancing.

The influence of an apparent rising support level provides a useful feature in the current area of the chart. Thanks to fellow analyst Unterhashing for point it out. Its approximate location is annotated in green. This may be the long-term support that is preventing further decline. However, we keep an eye on its location since – should it fail – we’re likely to see rapid decline to $500.

The 1hr chart (not shown) is signaling a potential push higher today (Thu 18 Aug) but the signal is happening below the 1-hour chart’s 200-period moving average, so best to remain skeptical – an updraft, now, may simply be a component of upward correction. The critical signal for a larger advance is that the 4hr MACD indicator should advance above its zero line, followed by price establishing above $600. That will be the time to trade.

Summary

Bitcoin price has found support near $555 (Bitstamp) and has made an initial set of higher lows in the 1-hour chart. If advance were to continue a push through $600 will see the 4-hour chart turn from neutral to bullish. Remember that a drop below $560 (Bitstamp) – although it seems unlikely at the moment – will open the can of downside pickles to $500. Best to wait for obviously bullish 4-hour and 1-day charts before betting money in the market.

Bitstamp Depth Chart and Buy/Sell Volume

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Click here for the CCN.LA interactive bitcoin-price chart.

What do readers think? Please comment below.

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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.

Disclaimer

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.

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