Bitcoin Technical Analysis 19th August

By August 19, 2014Bitcoin Business
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Emerging markets are imperative to Bitcoin’s growth and the adoption of Bitcoin in developing countries will make international payments easier and cheaper. BitX, a BItcoin services firm, has secured over $500,000 in funding to expand their emerging market operations. The need for and impact of crypto-currencies is the largest in these markets. BitX currently operates wallet services in Africa, South-East Asia, Eastern Europe and South America, with exchanges in South Africa, Kenya and Namibia. BitX is planning on entering other developing markets soon.

The public in the US have been given 45 days to comment on New York’s BitLicense proposal, with two research fellows from the George Mason University highlighting its shortcomings in a 14-page response. The researchers commended the goal of protecting consumers and prevent illegal activity but the BitLicense regulations are stricter than current anti-money laundering procedures. They also highlight the differences between a software wallet and a web wallet, noting that software wallets should not be subject to the same regulation as web-based ones, since a software wallet does not hold either the private or public keys for its users. They commend the New York Department of Financial Services, but suggest a further 45 day period for a new draft of BitLicense to find the right balance between encouraging innovation and preventing money laundering.

A new platform for Bitcoin analytics was launched yesterday in Amsterdam, called BlockTrail, which secured 500,000 Euros of funding. It aims to compete with and Blockr and to provide information about Bitcoin transactions via the creation of tools for the analysis of network and economic data. BlockTrail promises to be the average Bitcoin user’s dashboard for keeping track of transactions and has a social component that links wallet addresses to websites that mentions them, such as Bitcoin forums. BlockTrail hopes to provide a free of charge service for the foreseeable future, whereas competitors such as TradeBlock have said they plan to charge its users for access.

Bitcoin gained today after falling to a low of around $450, currently trading at $470.15, up 2.06% from today’s open. At the 4 hour timeframe, Bitcoin may encounter resistance at the $481.33 level and if this level is broken, we could see any price up to $523 being realized. Bitcoin’s price has support levels at $455.50 and $413.69. The chart below shows the 4 hour Bitcoin price chart for BITSTAMP exchange. The Moving average convergence divergence (MACD) indicator is suggesting an upward movement in the Bitcoin price, as the faster moving average is crossing the slower moving average in the upward direction. This suggests an upward trend in Bitcoin. Also, the parabolic stop and reversal is indicating the downward trend has not reversed yet, but the dots are very close to the price action and the parabolic stop and reversal could indicate the start of an upward trend very soon.


Looking at the hourly chart below, the parabolic stop and reversal indicated a reversal of a downtrend into an uptrend late last night. Any buy orders should not be completed yet and sellers should wait until the parabolic stop and reversal indicates a trend reversal. Also, the relative strength index has passed to 50 mark, which suggests a strong upward trend is underway.


Looking at the daily time frame, the Ichimoku cloud is above the price action, which suggests downward momentum. The cloud will serve as future resistance for the Bitcoin price at the $593-$606 level for early September. The stochastic is indicating oversold conditions, indicating a possible upward correction in the price.

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