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,…
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.
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
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
Time of analysis: 04h30 UTC
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
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.
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
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Last modified: January 3, 2020 3:24 PM UTC