Posted in: Older News
Published:
October 31, 2014 7:21 AM UTC

Bitcoin Price Faces Lower Lows in Continuing Slow Decline

Bitcoin Price is continuing a slow decline. Our target at $330 has not been struck decisively and price currently looks set to return to it - if not lower. Global Economy Bitcoin Price Lower Lows Summary Comments Global Economy The Bank of Japan, this morning,…

Bitcoin Price is continuing a slow decline. Our target at $330 has not been struck decisively and price currently looks set to return to it – if not lower.

Global Economy
Bitcoin Price Lower Lows
Summary
Comments

Global Economy

The Bank of Japan, this morning, shocked the world by announcing that it will increase its record breaking 70 Trillion Yen QE program to 80 Trillion Yen and triple its ETF buying program to 3 Trillion Yen.

The USD/JPY forex pair shot through 110 Yen per Dollar and the Nikkei stock index shot 1,000 points through the roof.

The exuberance is being manifest in stock indexes around the globe with the S&P500 also trading close to its all-time high. The downside of the BoJ move, of course, is that it is forcing a move on China whereby Yuan devaluation will become an export market necessity.

S&P500

Oh, Joy! A new all-time CFD high! 2,023.4 achieved during the Asian session of all times. Divergence (illustrated in magenta) says it’s not destined to continue indefinitely. [author’s note: reader @Umi pointed out that this CFD high is not reflected in the actual S&P500 Index.]

S&P500 Weekly Chart

Gold

Oh, George W Bush! A new three-year low! $1,166 achieved during the LME witching-hour prior to the London open. Divergence (illustrated in magenta and cyan) says the low is bound to bounce, but it may reach $1000 before doing so. Breaking below $1,180 is a breach of major long-term support and if Gold does not climb above this level quickly, the downside potential could be catastrophic – especially in view of the fact that there is now an established correlation between Gold and Bitcoin.

Gold Weekly Chart

Selected Economic Data

[divider]CCN[/divider]

Bitcoin Price Lower Lows

Time of analysis: 04h30 UTC

Asian Session

The Bitcoin price has rebounded from just above $330 in what looks to be a three wave structure to the upside. The wave reached above $350 before turning back down.

Bitstamp Hourly Chart

The directional bias is unclear, and we’ll have to wait and see what price action does during the coming sessions.

One possibility is that price concludes retracement to .618 since it has not been struck decisively. However, BTC-China’s chart has already exceed .618 which argues that the decline continues to .89 retracement at $290 (Bitstamp).

As much as several readers get their knickers in a jam at the mention of moon phase, I’ll disregard their sensitivity to esoterics and suggest that the decline may continue until next Friday 7 November’s Harvest Moon. In this case we may see a new decline low at $260 or $200 or lower.

Time of analysis: 09h30 UTC

European Session

Bitcoin price is superimposed in magenta.

Gold 4-Hourly Chart

Given the positive correlation between the Gold and Bitcoin charts during the past few months, it could be expected that Bitcoin follow Gold down to a decline low. However, Bitcoin has not yet made the journey. Perhaps the market is waiting for a catalyst. Seeing that Bitcoin has been less volatile than Gold during the past two weeks (as visible on the chart), it seems more likely that Bitcoin makes its decline over another week. Such an outlook needs to show itself by Bitcoin price staying below its daily 20-period moving average.

Summary

Decline looks likely to continue to $290 (Bitstamp). First give the .618 Fibonacci retracement at $330 (Bitstamp) a chance to assert itself – if it gives way then $290 becomes the next target.

Updates will track progress and identify conditions of a trend change.

Time of update: Saturday 1 November 16h10 UTC

[divider]CCN[/divider]

CCN hosts a Bitcoin Price page that features charts and various exchange metrics.

Readers can follow Bitcoin price analysis updates each weekday on CCN. In-depth analysis articles are published every Sunday.

Disclaimer

The writer is fully invested in Bitcoin via BTC-e and Bitfinex. Trade and Investment is risky but not as risky as some other things out there. Take care only to take action in the market when you are 100% sure of the outcome. CCN accepts no liability whatsoever for losses incurred as a result of anything written in this Bitcoin price analysis report.

Bitcoin price charts from TradingView.
Images from Shutterstock.

Last modified: January 3, 2020 3:24 PM UTC

Venzen Khaosan @venzen

Market analyst and Open source developer with a keen interest in blockchain technology, consensus mechanisms and the decentralizing effect. He has found a solution to the PKI mechanism. Email me to discuss.

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