Bitcoin price has pulled out of its downward correction but is now in a twilight zone between the advance high and a potential trend breakdown. How now? Let the market show the way.
Time of analysis: 14h00 UTC
From the analysis pages of xbt.social, earlier today:
Price has completed a three-wave pattern that could spell the end of a corrective advance since yesterday’s bounce. If price continues lower, then the 1-hour 200MA (red) will be a target. This level was touched in some exchange charts, but not yet in the Bitstamp chart. Below it lies the $550 level where a Fib line should offer support.
If price forms another wave to the upside then the present move is unlikely corrective and we will most probably see another attempt on $600 (Bitstamp). The gray channel lines may delineate an ending diagonal move to $600, after which a correction to at least $550 (or lower) will unfold – if an ending diagonal is indeed the game.
Slumping buy volume throughout 2016 remains a concern. It may pick up, however the overall impression of the frequently strained advance since February is that it is a base wave for the reward-halving advance – and not, yet, the reward-halving rally itself.
The bitcoin price chart shows the market’s indecision. It is best to wait for either a breach of $600 (above which waits $680) or a break lower accompanied by sell signals in most timeframes. If the past several months’ labored price action has been a base wave for advance, then we can expect it to retrace 50%-90% of its height from $350.
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Bitcoin price charts from TradingView.
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