Bitcoin price is making a gradual advance as the market chooses to forgo opportunities to resume decline. A strained upside push may accelerate, but for now it seems doomed to end abruptly.
Time of analysis: 15h11 UTC
From the analysis pages of xbt.social, earlier today:
Price is pushing higher in a gradual upward curve, as opportune moments for decline are passed over in favor of strained advance.
At the 15-minute timeframe the moving averages are aligned for advance and price has, for several hours, been trading above all of the MAs we monitor.
At the 1-hour timeframe the chart indications look different. Although price is trading above both the 20MA and 200MA the upside progress is being made with difficulty. The momentum indicators are diverged from price at each marginal high since Tuesday’s spike to to the upside.
This wave pattern is sometimes seen during bitcoin and gold price declines: a low is struck, a spike forms to the upside and, typically, price resumes the prior downtrend as soon as the spike ends. However, there are rare instances, such as the current price pattern, where price pushes higher in an upward curving arc – presumably either as a result of continuous short covering or because the market is buying into what looks like an uptrend. Such a price spike must be a sign of greater things to come, right?
Yet, it nearly always ends in a sell-off at some unpredictable moment. The upside strain becomes unbearable and the sell-off takes hold like wildfire. Such patterns are frequently completely retraced with the sell-off ending where the spike began.
We might see this in the coming days, but for now the choppy price action to the upside appears to have no clear target.
Best to stay out until we have more clarity.
Never confuse movement with action. – Ernest Hemingway
Sometimes the market moves consistently in one direction, but not all moves are suitable for trading. The current price wave is one such instance. It may travel far to the upside or it may collapse back into decline at any moment. We have no way of knowing and there are no clear technical indications in the chart to serve as confirmation of the duration or the target of the present price wave.
Bitfinex orderbook depth and Buy/Sell Volume:
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Bitcoin price charts from TradingView.
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