Skip to content Skip to sidebar Skip to footer

To a new investor entering the crypto-space sights like today’s 3.5% pump to $9,141 is enough to make you giddy with excitement about the future of cryptocurrency.

But is it that impressive? After all, Bitcoin (BTC) price was $9,300 last week, which is $200 higher than it is now. So let’s take a look at some of the factors causing, and fuelling these swings.

Daily crypto market performance. Source: Coin360.comDaily crypto market performance. Source: Coin360.com

Bitcoin CME gap 

Bitcoin price (BTC) took a dive from $9,265 and closed at $8,804.88 on Friday, November 8th, in what is becoming quite the predictable event, the CME Gap.

Last week many traders were screaming for $8,885 to be filled, and even though this is becoming quite a regular thing, world-renowned Bitcoin hater, Peter Schiff took to Twitter to call for a dump in Bitcoin price. Schiff tweeted

“It looks like the #Bitcoin pump is finally over. Get ready for the dump!”

Of course, one only has to look at the engagement Mr. Schiff receives on his anti-Bitcoin crusade to see that he gets 14 times more interaction on his crypto tweets than he does on his dreary tweets about gold.

Outside of Schiff’s ever dreary tweets, the situation seems to be improving for Bitcoin. The CME gap has been filled so what can traders expect from Bitcoin over the coming week? 

BTC USD daily chart. Source: TradingViewBTC USD daily chart. Source: TradingView

The Bollinger Bands indicator on Bitcoin’s daily chart shows that the price has been hovering around the moving average (MA) which is now near $8,900 since the CME gap was filled.

When the price is set so close to the middle of the indicator traders could be fooled into thinking the odds of falling to the support at $7,800 are equal to the odds of the price rising to the resistance of $10,130. Fortunately for the bulls, there are quite a few factors that suggest the price is more likely to rise over the next week rather than fall.

The first thing to consider is that the CME gap is something of an anomaly unique to the Bitcoin price action. As such, the Bitcoin price usually recovers almost immediately after it’s filled. So why hasn’t it bounced back after shedding $500 off the Bitcoin price nearly 3 days on?

Bitcoin Historical Price Data. Source: CoinMarketCap

Bitcoin Historical Price Data. Source: CoinMarketCap

This question can be answered quite easily as one only needs to look at the trading volume of Bitcoin on weekends compared to weekdays to see that the volume is much thinner on Saturdays and Sundays compared to the working week.

As such, it would be entirely plausible to consider that as the markets open across the world on Monday, trading volume for Bitcoin will increase, and this would be a key factor in driving the price. But forecasting volume alone, cannot guarantee an increase in price, so to find more reason for this, one must also take a look at a couple of proven indicators to better gauge the next move. 

Bitcoin Weekly Trading Volume. Source: Bitcoinity.org

Bitcoin Weekly Trading Volume. Source: Bitcoinity.org

The weekly MACD continues to flip bullish

BTC USD weekly MACD. Source: TradingViewBTC USD weekly MACD. Source: TradingView

Out of all the technical indicators available, the Moving Average Divergence Convergence (MACD) is the one to watch on the weekly timeframe. The price dump on Nov. 8 caused the oscillator to alter its trajectory ever so slightly, however, thanks to Sunday’s price rally, it seems increasingly probable that a bull cross could occur in the next 2 to 3 weeks if not sooner.

When the MACD crosses bullish on this time frame, Bitcoin never fails to impress, as such this is a huge buying signal to traders. As mentioned earlier, it’s still not quite there yet, however it is on another popular crypto asset.

Ether set for a bull cross on the weekly MACD

ETH USD weekly MACD. Source: TradingView

ETH USD weekly MACD. Source: TradingView

Last week’s analysis covered a similar scenario for Litecoin (LTC) and since then the altcoin increased by 13%, rallying from $57.64 to $64.27 within just 4 days. Right now, Ether (ETH) is looking almost identical from a technical perspective, with the only difference being the fact that the digital asset could catalyze a number of altcoins to rally due to their pairings across many exchanges.

Therefore, it’s safe to ask, Is this the start of the next altcoin season? Let’s take a look at where Ether price could go

Ethereum price targets

ETH USD weekly. Source: TradingViewETH USD weekly. Source: TradingView

If Ether were to rally, this would be a welcome pump. Assuming that Ether tallied the same percentage of gains that Litecoin experienced last week, the price would sit $5 above the moving average on the Bollinger Bands indicator. 

This could set Ethereum up for a run-up to around $285 which wouldn’t just bring the Ethereum market capitalization up by 30%, it would also potentially have a huge knock-on effect with ETH-paired altcoins which could trigger a retail FOMO phenomena similar to the one seen in 2017.

Bearish scenario

Bitcoin needs to fend off a few areas of support. Should the current support of $8,900 fail to hold, it opens up a new level around $7,800 that needs to be defended. One would hope that the days of seeing the Bitcoin price at this level are over for 2019, however, it was only a few weeks ago that the majority of Bitcoin bears on Twitter were calling for $6,000 Bitcoin this year. Should $7,800 fail to hold, this could then become a reality.

Bullish scenario

As the weekly candle closes, it is likely to send a strong buy signal to traders. Bitcoin has to first break $9,900 before investors and traders alike can expect a 5 digit Bitcoin. Should Bitcoin price exceed expectations and march past $10,000 to find support above $10,130, then the digital asset will be set for a bullish MACD cross in the immediate future. This could be the push Bitcoin requires to achieve a new all-time high.

The views and opinions expressed here are solely those of the @officiallykeith and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.

Cointelegraph By Keith Wareing , 2019-11-10 23:31:00 ,

Source link

Leave a comment

NewsBlock © 2019 - 2020 All rights reserved.

NewsBlock © 2019 - 2020. All rights reserved.


While Bitcoin’s price seemingly moves without rhyme or reason — collapsing by dozens of percent and embarking on face-melting rallies on a whim — the cryptocurrency market is filled to the brim with fractals.

Related Reading: Analyst: Bitcoin Price Likely to Fall to Low-$8,000s as Chart Remains Weak

A brief aside: A fractal, in the context of technical analysis and financial markets anyway, is when an asset’s price action is seen during a different time. This form of analysis isn’t that popular, but it has proven to be somewhat valuable in analyzing Bitcoin.

One recent fractal popularized by a well-known cryptocurrency trader is implying that BTC is going to return to the low-$7,000s in the coming days.

Bitcoin Fractal Implies Retracement to Low-$7,000s

A well-known crypto trader going by “Tyler Durden” on Twitter recently posted the chart below, which shows that a Bitcoin price fractal may be playing out. The fractal has four phases: horizontal consolidation marked by one fakeout, a surge above the consolidation phase, a distribution, then a strong drop to fresh lows.

If the fractal plays out in full, BTC could reach the low-$7,000s again, potentially as low as $7,100. This would represent a 20-odd percent collapse from the current price point of $8,800.

It isn’t only a fractal that is hinting Bitcoin has the potential to visit its lows. As we reported on Saturday, Bloomberg believes that if the GTI Vera Convergence Divergence Indicator flips red, a downtrend could push the cryptocurrency back to $7,300.

Related Reading: Stephen Colbert Pokes Fun at Bitcoin in Monologue: Mainstream Gone Wrong?

Can Bulls Step In?

But again, many believe it is irrational to have such bearish interpretations of the cryptocurrency’s chart at the moment. As reported by NewsBTC earlier, Popular crypto trader Mayne recently noted that the “people waiting for $6,000” are irrational. He quipped that Bitcoin retracing and consolidating after its fourth-biggest bull move in history ($7,300 to $10,500, a 42% gain) is perfectly par for the course, but noted that it’s totally possible we can go lower from $8,800.

The medium-term technicals support this.

Trader and CoinTelegraph contributor FilbFilb found that by the end of November or start of December, the 50-week and 100-week moving averages will see a “golden cross,” which he claims is far more significant” for the Bitcoin market that other technical crosses.

Also, a Bitcoin price model created using Facebook Prophet machine learning found that the leading cryptocurrency is likely to end the year at just over $12,000. What’s notable about this model is that it called the price drop to $8,000 months in advance, and forecasted a ~$7,500 price bottom for BTC.

To put a cherry on the cryptocurrency cake, Crypto Thies observed that when Bitcoin bottomed at $7,300, it bounced decisively off the 0.618 Fibonacci Retracement of the move from $3,000 to $14,000, which correlates with the two-week volume-weighted moving average. He added that summer 2019’s consolidation was marked by Bitcoin flipping major resistances into support levels, implying that a bullish reversal and subsequent continuation is likely possible in the coming weeks.

Featured Image from Shutterstock


Nick Chong , 2019-11-10 12:00:38

Source link