Bitcoin price returned to a central line of advance, after temporarily dropping below it over the weekend. The price action now unfolding in the chart is characteristic of previous consolidative periods.
Time of analysis: 14h39 UTC
From the analysis pages of xbt.social, earlier today:
Price had fallen towards $300 and then promptly returned to its previous trading range at $330 and 2100 CNY.
The two diagonal lines along which price has been trading are Fibonacci fan lines that originate at the January and August 2015 lows. The red Fib line had been a central pivot to the recent rally, so price returning to it is an acknowledgment of its continuing significance.
This alternation between established price levels is characteristic of the price action we had witnessed in early June and from 14-21 September this year.
Presumably, the market is preparing for a larger move and we hope for a return to advance. While previous support and resistance gets tested there are few trade opportunities, since the moves are erratic and difficult to predict.
We wait for a trend to emerge and once we see price establish either a series of higher highs or lower lows we can look for trade signals in the chart.
Machines take me by surprise with great frequency. – Alan Turing
It seems odd that the market has not yet retested the $300 price level. Perhaps there is no need, and if the market can consolidate at current levels and then resume advance, the outcome will be more favorable than a return to the messy chart area between $200 and $300.
Bitfinex orderbook depth and Buy/Sell Volume:
What do readers think? Please comment below.
Readers can follow Bitcoin price analysis updates every day on CCN.LA. A Global Economic Outlook report is published every Monday.
The writer trades Bitcoin. Trade and Investment is risky. CCN.LA accepts no liability for losses incurred as a result of anything written in this Bitcoin price analysis report.
Bitcoin price charts from TradingView.
Image from Shutterstock.