Bitcoin Price Support Broken

Journalist:
Jim Fredrickson @jimfred1276
January 30, 2017

Bitcoin closed just below the arc support it had been resting on for a couple days.  As you can see below, the top of the square stopped this advance for 3 days in a row.  This break below support does not support the bullish argument. Let’s look closer at a short-term chart to see if there is more information to be gleaned therein:Here can see that the bearish setup from the swing high on a 4-hour chart (Kraken) has also seen a break in support, as price has closed below first arc support (blue arc), and also below the 2×1 Gann angle (red line). As can be observed, the 2×1 was resisting price for quite a while before it just briefly managed to get (marginally) above the angle. All of these things suggest weakness in price will continue.

I have expressed the opinion on these pages that the correction was not yet over.  If in fact the downturn resumes here, perhaps as a C wave of an A-B-C Elliott Wave, this bear setup on the daily chart indicates where the major supports will be found:Interestingly, price was stopped by the 1×1 angle on this setup, which suggests that pricetime is respecting the setup.

The blue arrow is pointing to the ‘0 line’ of an Andrews Pitchfork (not shown).  That support, at ~ 850 could hold, at least temporarily.  More likely, imho, long-term support will be found at the 3rd or 5th arc pairs  (red and green arrows respectively).  The green arrow shows the intersection of the 5th arc and the 2/21/2017 timeframe.  This February date is highlighted as a significant energy point (in time) in the bitcoin market by the ‘Spiral Calendar’ championed by Chris Carolyn.

Happy trading!

Remember:  The author is a trader who is subject to all manner of error in judgement.  Do your own research, and be prepared to take full responsibility for your own trades.

Image from Shutterstock.

Last modified (UTC): January 30, 2017 19:18

Jim Fredrickson @jimfred1276

Jim has an MBA from the University of Southern California. He has been trading commodities, forex and bitcoin since 1993. You may email him directly at: jimfred1276 at gmail dot com. Feel free to follow him on twitter.