Bitcoin trading has been holding price between technical constraints just above $400. The option of moving out of this range has been tried to the upside and down, recently, without igniting a meaningful trend. Classic(TM) dithering and consensus breach may be unnecessary, after all.
Time of analysis: 13h30 UTC
From the analysis pages of xbt.social, earlier today:
Although the chart is primed for a strong directional move, it seems the market is at a loss for direction at the moment.
The OKCoin 3Month futures chart has been chosen, arbitrarily, and shows the larger 4-hour timeframe. The 20-period moving average (green) and 200-period moving average (200MA, red) are included in the chart as well as two declining channels and a support zone just below $400.
Price had failed to touch its lower channel trendline on the weekend, as the market showed respect for the $400 level (in this chart) as a significant demand zone. Earlier in the year, price action in this zone had been erratic and the market appears to be avoiding a dip below $400.
Downside aversion aside, the market had failed to hold price above its 200MA (red) following an energetic rally that ran out of conviction at the resistance ceiling near $480. Attempts to cross above the 200MA during the past few days have been unsuccessful, and the momentum indicators reflect the indecision by consolidating to their neutral positions (magenta arrows).
Meanwhile, price is gradually approaching a declining channel trendline (light blue) that will force the market into a decision. Breaking above the trendline and the 200MA could see price target either of the two recent wave tops at $450 and $475 (OKCoin 3Month).
On the insecure bearish side, heading back below $400 holds the prospect of tedious sideways trade, and potentially, additional decline.
After trading bitcoin price above $300 in October – and briefly attaining the mid $500s – the price chart has been consolidating in a narrowing range. During 2016, the range has narrowed to the chart area between $350 and $450 – a range wherein price is currently trading at the midway level near $400. A mid-year blockreward-halving rally is widely anticipated, and the event is only three months away.
If uncertainty around a dangerous Bitcoin blockchain hijacking can be mitigated, ongoing decline could become ongoing consolidation, for as long as the threat persists. Of course, the uncertainty could be eliminated completely if Classic(TM) redefine their project as a new large-block blockchain (without SegWit) called ClassicCoin. Both sides of the scaling schism will have what they want, and the drawn out bitcoin price chart consolidation will turn up into a fundamental bitcoin price rally.
What do readers think? Please comment below.
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Bitcoin price charts from TradingView.
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