Bitcoin Price Sell-Off But Advance Not Over

Journalist:
February 21, 2016

Bitcoin price sold off from just below $450 to $430. The market may be wondering whether this is the start of a downtrend, but wave analysis shows that the advance has more upside in store.

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Bitcoin Price Analysis

Time of analysis: 14h00 UTC

OKCoin 3Month 1-Hour Chart

From the analysis pages of xbt.social, earlier today:

A sell-off has drawn a long red candle in the price chart and retraced advance since Friday.

According to the wave count in the chart, bitcoin price is apparently extending its 5th waves and has just completed wave 3 of the larger advancing wave. The current sell-off would count as wave 4, and that implies another advancing wave – wave 5.

The 4th wave (today’s sell-off) had targeted the area (magenta rectangle) of the previous 4th wave – labeled wave ‘iv’ – although it could also target wave ‘ii’ before pushing higher.

A look at the December top shows similar price patterns that failed to make a new high before eventually falling back into decline.

This may or may not happen in the present advance – we’ll have to see where the next wave of advance reaches, but as always, we open position based on a signal and close according to a dynamic stoploss, so knowing the exact target of a wave does not determine our xbt.social trading success.

Summary

Bitcoin price is correcting part of the advance and should continue higher once the profit takers are done. Best to now wait for the correction to play out and then open a long position when the 1-hour chart indicators signal advance. xbt.social can show you how to identify such signals for buying and selling.

Bitfinex Depth Chart and Buy/Sell Volume

Click here for the CCN.LA interactive bitcoin price chart.

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This analysis is provided by xbt.social with a 3-hour delay. Read the full analysis here. Not a member? Join now and receive a $29 discount using the code CCN29.

Readers can follow Bitcoin price analysis updates every day on CCN.LA. A Global Economic Outlook report is published every Monday.

Disclaimer

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.

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.