Bitcoin price continues trading across critical support just above $400. Maintaining this position is the key to additional advance. Losing it, will open a proverbial can of downside toward the lows of 2015.
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Bitstamp 4-Hour Chart
From the analysis pages of xbt.social, earlier today:
The bitcoin price chart is looking decidedly bearish, but it is worth pointing out some technical indications and a price pattern that may spare traders getting into a premature short position.
Firstly, the bearish indications:
The 4-hour chart shows price trading at its 20-period moving average (20MA) and, marginally, above the significant 200MA. The faster stochastic (top panel) has reached its upper extreme. Once price declines below the 200MA (red) it has no structural supporting for a long distance to the downside – indicated by two blue arrows.
Secondly, potential for an upward spike:The magenta circle in the 4-hour chart shows a juncture, similar to the present one, where price had first shot back to the previous high before beginning a devastating decline. Since November, price had consolidated in the vicinity of the 200MA on two occasions – each time resulting in a surge higher – even if only corrective. The price action in the magenta circle illustrates the most recent instance of this phenomenon in the 4-hour chart.The pattern may repeat, and it would be prudent, before taking a position, to a) anticipate the surge up, and b) expect it to reverse near the previous high. If the market chooses to resume decline without taking the correction higher first, a potential decline target waits at $320 (Bitstamp) and 2100 CNY. Summary Bitcoin price […]
