Bitcoin trading has become listless and lacks direction. Perhaps the succession of two advancing waves and a return to the vicinity of the previous high has cooled down the market’s eagerness for additional advance.
Bitcoin Trading and Price Analysis
Time of analysis: 14h00 UTC
OKCoin BTC/USD Spot 1-Hour Chart
From the analysis pages of xbt.social, earlier today:
The current indicator conditions are similar to previous instances where price had found support and advanced from.
A concern is that the upside is constrained by a resistance ceiling near $468 (OKCoin Spot). That the 1hr MAs are turning down slightly is another concern – implying that their support of price is fading.
At the 15-minute timeframe price is currently trading below its 200MA. This is not necessarily a bearish signal (and certainly not a reason to trade short without larger timeframe confirmation). The sense is just that, although the 1hr chart implies an upside breakout, the 15min chart does not confirm the consolidation as over.
A glance at the most exchanges’ depth charts shows lots of sell orders hovering above price – presumably orders to take profit. So, another sign that advance may be limited.
Looking to a short- or medium-term bearish scenario, it is feasible that price correct lower and find support near $430 in the OKCoin spot chart, and near 2800 CNY. If both the 15-minute and 1-hour chart moving averages break down then a correction may happen. However, we don’t want to trade such an initial move for two reasons:
1) The move down may simply be a sell-off that bounces higher from the 200MA (red) unexpectedly.
2) Whether a wave down is a short, sharp correction or the first wave of a larger move will be revealed by the level at which it finds support and in the internal structure of the wave down.
If downside were to continue, we’d trade it only after we’ve seen the initial wave and assessed the market’s intentions.
Bitcoin trade has become sluggish as general market activity slows into the holiday season. Hopefully, the market is only consolidating into year-end with no major moves, and we get a buy signal across timeframes near the start of 2016.
Bitfinex Depth Chart and Buy/Sell Volume
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Bitcoin price charts from TradingView.
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