Bitcoin Price Squeeze Into Decision-Time

By
Venzen Khaosan @venzen
3 years ago

Bitcoin price is trading into a narrowing range and the market will soon be forced to choose a direction. Upside options are limited while the long-term indicators return to neutral, and if the outcome is decline, it will hopefully be contained above $500.

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Bitcoin Price Analysis

Time of analysis: 15h00 UTC

Bitstamp 1-Hour Candle Chart

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

1-Hour MACD (panel above price) is consolidating to zero with its Bollinger Bands contracting, indicating the low volatility quiet that usually precedes a directional price move.

Price has held below the 1-hour candle chart’s 200MA (red) since coming down from the rally top. During the past day the market has tested the 200MA on two occasions while also finding support around $634 – a support and resistance level that was established on the way up during early June.

If the market can trade price above $660 (Bitstamp) then price will have chart headroom to target $680 – another important support and resistance level dating back to 2013 and 2014. Notice how a well-formed inverted head-and-shoulders pattern (annotated in blue) had failed, last week, at $680.

Below $634 is not an easier path for price, either, with several unsuccessful declines being rejected during the past week. If price does sell-off into this chart region, then Fibonacci extension targets exist – not surprisingly – at the previous low near $560 and at the $500 psych level.

Barring a bullish resurgence, the stochastics (top right) imply that the bias, at the 1-hour timeframe, is bearish.

Summary

Bitcoin price remains below the 1-day chart’s 20MA, and speculators should consider keeping funds allocation at 40:60 BTC vs fiat until we see a confirmation of a return to uptrend. The 1-day MA is currently approaching $674 (Bitstamp) and reinforces the upside resistance at $680 discussed above. In case of continuing decline sellers will encounter strong resistance at $560 – the recent corrective low. Let’s hope this is the bottom of a consolidation area prior to advance.

Bitfinex Depth Chart and Buy/Sell Volume

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

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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.

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