Bitcoin price has been churned into a washing machine lately and today was no exception. On the aniversary of the start of history’s largest asset price rally on 5 October 2013, the bitcoin chart, once again, looked primed for a sharp decline. However, by 10h00 UTC speculators snatched price from the claw of the Bear and passed it to the rearing bulls.
Bitcoin Price Analysis
Time of analysis: 15h03 UTC
BTC-China 1-Hour Chart
From the analysis pages of xbt.social, earlier today:
Price dropped below its 1-hour 200MA (red) and then reversed amid strong reversal signals in the indicators. An empty candle wick in the 15min and 1hr chart attests to the strong buying that lifted price back above support.
At the time of writing price is advancing in what looks like a motive impulse wave and the level that it will have to beat is a horizontal resistance layer at $241 in the Bitstamp chart, $238 in the BTCe chart, $240 in most other BTC/USD charts and 1550 CNY in the BTC-China and Huobi charts.
Strong divergence in RSI (second from top) and the xbt.social stochastic indicator (blue dots, top), as well as MACD (bottom) ascending steeply above its signal line (and about to cross its zero line in the coming hours) support the move higher.
There are two immediate obstacles to uninterrupted advance:
1) Both RSI and MACD are lagging the advance and will soon form reverse divergence: a lower high, while price makes a new high. This should precipitate a price correction below (or just above) the resistance around $240 and 1550 CNY.
2) Crypto-monkeys have been selling every approach on the upside resistance and may continue this profit-taking-for-peanuts behaviour.
If price can establish above the resistance layer then a strong surge may follow. However, nervous market participants may halt advance with compulsive profit-taking at the target just above $250 and 1580 CNY.
Trading is a game of probabilities. You don’t have to be right every time. You just have to follow your rules. – Vadym Graifer
Speculators should wait for price to establish above the $241 and 1550 CNY resistance level before positioning too heavily for advance. Although an upside breach seems imminent there are large hands playing heavy in the market and trades will flow better going with them rather than while they’re canning the thunder.
Bitfinex orderbook depth and Buy/Sell Volume:
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Bitcoin price charts from TradingView.
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