Finally, Bitcoin has extricated itself from the seemingly never-ending trading range between $620 – 640, although the bulls did not quite have enough juice left to push sustainably above $650. Despite needing a small recharge, the market looks primed for more upside in the coming weeks. Over the past few months the Bitcoin price has been tracking unusually closely to the USDCNH exchange rate, which has been relatively flat until recently. Last week saw a substantial increase in chatter regarding additional Yuan devaluations going into year end, and last Friday saw the exchange rate hit a multi-year high (meaning a historically weak Yuan). This pushed Bitcoin convincingly above resistance at $630, $640, and $640, although the bulls were unable to hold the $650 level for very long due to short-term overbought conditions. Now price is settling back into a consolidation range for the time being, likely in the $640 – 655 area, in order to reset the indicators, washout weak hands, and find legitimate support. Having said that, the longer term charts continue to look fairly bullish so we are maintaining our upward bias for now. Speaking of the longer-term outlook, today we take a look at the 3-day chart for a broader view of what is currently happening in the market. We can see that price is butting up against the OTE short zone which starts around $660 following a nice market structure bottom at the 38.2% Fibonacci retracement level. Also notice that the momentum oscillators are in need of a pullback given Willy is officially oversold, RSI is close, and MACD remains rather anemic. Lastly on the bearish side of things, price remains well outside of the volume profile value area and above a large notch, however this area may remain unfilled, considering we think a selloff […]
