Bitcoin Price Technical Analysis for 02/23/2017 – Short-Term Selloff Due?

Bitcoin Price Key Highlights

• Bitcoin price has been on a strong climb recently but seems to be having trouble extending its gains past the $1100 mark.
• A double top formation can be seen on the short-term time frames, signaling that a selloff might happen soon.
• Price has yet to break below the pattern’s neckline at the $1075 area before confirming that potential drop.

Technical Indicators Signals

The 100 SMA is above the longer-term 200 SMA so the path of least resistance is to the upside. The 200 SMA is also holding as dynamic support at the moment, but a break below this level could be an early signal of a reversal. Also, the gap between the moving averages is narrowing so a downward crossover might take place and draw more sellers to the mix.

Stochastic is already indicating overbought conditions and is turning lower, indicating a potential pickup in bearish pressure. If bitcoin price breaks below the double top neckline, it could fall by around $20-30, which is the same height as the chart formation. RSI is treading sideways, barely offering any strong directional clues at the moment.

Market Events

Traders seem hesitant to take bitcoin price any higher at this point for fear of attracting more attention from Chinese authorities and triggering another wave of investigations or measures to curb trading activity. Price could keep consolidating from here as investors try to weigh in on recent developments while keeping tabs on updates from other parts of the globe.

Demand for bitcoin in Europe is supported due to the uncertainties in the region, particularly when it comes to French and Italian politics, Greek debt, and Italy’s banking situation. Increased investor jitters could keep shoring up demand for alternative currencies in anticipation of potential capital controls or instability in the shared currency.

Meanwhile, traders are also on the lookout for a March Fed rate hike, which might boost the dollar’s value significantly. Based on the FOMC minutes, policymakers are keeping the option on the table for March but this depends on how upcoming jobs and inflation reports turn out.

Charts from SimpleFX

Disclaimer: The information contained herein is not guaranteed, does not purport to be comprehensive and is strictly for information purposes only. It should not be regarded as investment/trading advice. All the information is believed to come from reliable sources. NewsBTC does not warrant the accuracy, correctness, or completeness of information in its analysis and therefore will not be liable for any loss incurred.

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