Bitcoin: USD/BTC (BTC=X) volatility spikes to six-week high amid slump to $7,750

By January 12, 2020Bitcoin Business
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Bitcoin: USD/BTC (BTC=X) volatility spikes to six-week high amid slump to $7,750

Bitcoin: USD/BTC (BTC=X) volatility spikes to six-week high amid slump to $7,750

Bitcoin has endured its most volatile week since late November with price swinging wildly between $7,400 and $8,400.

It is currently trading at $7,750 following a major rejection and subsequent sell-off from the $8,400 level of resistance.

BTC has however bounced by 2% from the low of $7,650.

Several analysts are still predicting that Bitcoin will surge through the $8,400 level of resistance in the coming weeks, with $8,850 emerging as a potential target.

However, price action to the upside will only come to fruition if Bitcoin can form a level of support by closing numerous daily candles above the $7,900 region, which held during September and on several occasions in the 2018 bear market.

The 200 exponential moving average (EMA) on the daily chart also serves as a tough hurdle to surpass for Bitcoin, with it clearly acting as a point of resistance throughout Tuesday’s rally to $8,400.

It is currently residing at $8,150 and has been a historic point of support and resistance throughout Bitcoin’s 11-year history.

Should Bitcoin reach this level again, another rejection in price could also be on the cards, which would almost certainly cause a dive in price back towards $7,400 and $6,800. This is reiterated by the rapidly falling relative strength index (RSI).

The daily RSI is now below 60 after topping out at 68, and while there has been a slight uptick in the past 24 hours, the immediate trend is almost certainly down.

Technical Indicators

Overall, the bias in prices is: Upwards.

Note: this chart shows extraordinary price action to the upside.

The projected upper bound is: 8,667.05.

The projected lower bound is: 7,599.06.

The projected closing price is: 8,133.06.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 8 white candles and 2 black candles for a net of 6 white candles. During the past 50 bars, there have been 27 white candles and 23 black candles for a net of 4 white candles.

A spinning top occurred (a spinning top is a candle with a small real body). Spinning tops identify a session in which there is little price action (as defined by the difference between the open and the close). During a rally or near new highs, a spinning top can be a sign that prices are losing momentum and the bulls may be in trouble.

Three white candles occurred in the last three days. Although these candles were not big enough to create three white soldiers, the steady upward pattern is bullish.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 61.6259. This is not an overbought or oversold reading. The last signal was a sell 3 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 65.10. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 25 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is 102.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a sell 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 24 period(s) ago.

Rex Takasugi – TD Profile

FOREX BTC= closed up 76.920 at 8,114.500. Volume was 86% below average (consolidating) and Bollinger Bands were 1% narrower than normal.

Open     High      Low     Close     Volume___
8,095.3708,153.7407,979.3008,114.500 11,660
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 7,759.79 7,359.16 9,124.43
Volatility: 45 47 71
Volume: 99,096 91,171 86,184

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX BTC= is currently 11.1% below its 200-period moving average and is in an upward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of BTC= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on BTC= and have had this outlook for the last 7 periods. The security price has set a new 14-period high while our momentum oscillator has not. This is a bearish divergence.

Bitcoin has endured its most volatile week since late November with price swinging wildly between $7,400 and […]

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