Bitcoin price fell through $440 (Bitstamp) and has subsequently pushed back above this initial decline target level. The market has found support but today’s retracement lacks bounce.
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Time of analysis: 14h00 UTC Bitstamp 4-Hour Candle Chart
From the analysis pages of xbt.social, earlier today:
A high concentration of bearish signals occurred at the opening of the 4-hour candle pointed out by the magenta arrow, and opened a high-leverage trade as price declined rapidly to below our xbt.social target of $440.
An important condition for entry was that a 4-hour candle both opened and closed below the 200MA (red). Subsequently, MACD (panel above price) dropped below its lower Bollinger Band (while below the MACD signal line) and smaller timeframes gave similar, confirmatory sell signals.
Price reacted to a powerful support line in the form of a rising Fib line (grey) originating at the January 2015 low. The market could grapple with this level or may find support for another upside attempt.
However, the sense is that price could continue decline below this support line if the market’s primary target is the 1-day 200MA currently at $413 in the Bitstamp chart. Price has not touched its 1-day 200MA for over 7 months and reversion to the mean is a strong force in any price chart, as it is in most cyclical phenomena. Additionally, if price continues the declining journey it is likely that it may overshoot its target to the downside.The xbt.social trading plan objective is not to aggressively trade the downside – caution is paramount since a bullish resurgence could set in at any moment. Our objective is to […]
