Bitcoin has failed to latch onto the weekly high of $466.64, coming down swiftly to $442.38 in a week dominated primarily by the first US interest rate hike in almost a decade. Interestingly, the cryptocurrency failed at the same level in the previous week also.
As the week comes to close on a relatively weak note, it might provide the bears with a much-needed impetus to make bitcoin less expensive.
We will discuss today the weekly BTC-USD price chart from BITSTAMP exchange. The picture is very similar to what we observed in the previous weekly price technical analysis i.e. bitcoin is overbought from a technical perspective.
- Bollinger Bands – The cryptocurrency is still trading above the upper range of the BB, clearing pointing that it is overbought from a near-term perspective.
- Moving Average Convergence Divergence – The MACD has soared to a new yearly high during the week. MACD currently reads a value of 38.7168 while the Histogram has touched 21.8743. While the momentum has gained, it clearly hasn’t proved enough to take the price above the previous week’s resistance of $467.80.
- Money Flow Index – The latest MFI reading of 78.9963 is a red alert in itself. Readings at or above 80 signify risky levels.
- Relative Strength Index – The weekly RSI value has touched 73.1413, indicating that there is only limited room for upside. A value above 70 is indicative of an overvalued condition, however, this may fail in a trending market.
From each and every technical indicator presented above, one can infer that the current level might not be suitable for the buyers. The better choice would be to keep decreasing long positions on higher levels and wait for lower levels to enter the market.
Very short-term traders can go short on bitcoin by placing a stop-loss just north of $468 when the price reaches $465. The target for the trade would be $ 440.