Bitcoin Targets after 50-week MA Broken
On the hourly analog Bitcoin Bitfinex chart, I will back up to show you what happened after the last post on Friday afternoon and some of the warning signs.
Price was meandering along between the thin black 200 hour moving average and the light blue 50 hour MA when the reg flags began. Typically, the 50 hour MA shouldn’t be too hard for price to break in either direction, when the market has conviction either way.
Price spent the better part of 24 hours riding along that light blue 50 hour MA, and barely had any energy to break on through that level.
The thin black 200 hour MA was retested again and provided with some support before the final retest of the 50 hour MA happened at 4pm EST on Saturday June 9th and met with no follow-through when someone said they were out.
Price also completed a nice head and shoulder topping pattern, which I have marked on the screenshot below and is typically one of the most reliable charting patterns.
The next move was swift and decisive breaking all previous support line with vengeance. the lime green horizontal support line at $7,500 would have been a good level for a stop loss and the market agreed as there was barely any buying taking place at that level.
I would have thought that the dark blue up-trending support line would have provided some stout support and a more considerable bounce given it’s historical importance the past few months, but momentum was on the bears side at that point and it only took 9 hours before price gave way again by moving down over $500 in one hour.
Since than price has come to a new equilibrium over the past 24+ hours around $6,725. I have put a light blue box around this range because price will move which ever direction price breaks out of the top or bottom of the rectangle.
RSI has some strong bearish divergence over the past 24 hours here and is quickly coming back neutral, so the chances are we will get a bit more of bullish pop in price over the next few hours, maybe back to that nemesis of the 50 hour MA at around $6,900 - $7,000.
On the daily Bitcoin analog Bitfinex chart, price has decisively broken through that long-term dark blue up-trending line that has been providing support on the previous lows from the past few months.
This could be a temporary shake out from this trend line however if that were the case, price would need to recover pretty quickly to $7,500 maybe within the next week to remain valid.
The better support line right now is the black horizontal support at $6,500, which from the past few months appears as a triple bottom for right now. I have marked those bottoms with the green arrows on the chart.
This would provide a solid descending triangle between the black horizontal line and the down-trending red line from the last few months.
The next support target would be the maroon horizontal line at $5,962 which would be a solid level from back in October of 2017.
The RSI is on the verge of entering oversold territory here and has also put in a slightly lower low on the indicator from the low on May 28th at 30.38 to the low yesterday at 30.33, signaling this trend still may have some downward momentum to go.
On the weekly analog Bitcoin chart I had warned that if price did not close above the 50 week moving average which now resides at $7,800, price could continue to head down into a longer bear trend.
Unfortunately, this did happen and the liquidation that began on Saturday afternoon could have been the acknowledgement of the trend beginning, not solely the news of the Coinrail exchange being hacked.
There’s a lot more that can be said about this trend and subsequent analysis, I can discuss that more tomorrow.
-More on vanddar.com
Price was meandering along between the thin black 200 hour moving average and the light blue 50 hour MA when the reg flags began. Typically, the 50 hour MA shouldn’t be too hard for price to break in either direction, when the market has conviction either way.
Price spent the better part of 24 hours riding along that light blue 50 hour MA, and barely had any energy to break on through that level.
The thin black 200 hour MA was retested again and provided with some support before the final retest of the 50 hour MA happened at 4pm EST on Saturday June 9th and met with no follow-through when someone said they were out.
Price also completed a nice head and shoulder topping pattern, which I have marked on the screenshot below and is typically one of the most reliable charting patterns.
The next move was swift and decisive breaking all previous support line with vengeance. the lime green horizontal support line at $7,500 would have been a good level for a stop loss and the market agreed as there was barely any buying taking place at that level.
I would have thought that the dark blue up-trending support line would have provided some stout support and a more considerable bounce given it’s historical importance the past few months, but momentum was on the bears side at that point and it only took 9 hours before price gave way again by moving down over $500 in one hour.
Since than price has come to a new equilibrium over the past 24+ hours around $6,725. I have put a light blue box around this range because price will move which ever direction price breaks out of the top or bottom of the rectangle.
RSI has some strong bearish divergence over the past 24 hours here and is quickly coming back neutral, so the chances are we will get a bit more of bullish pop in price over the next few hours, maybe back to that nemesis of the 50 hour MA at around $6,900 - $7,000.
On the daily Bitcoin analog Bitfinex chart, price has decisively broken through that long-term dark blue up-trending line that has been providing support on the previous lows from the past few months.
This could be a temporary shake out from this trend line however if that were the case, price would need to recover pretty quickly to $7,500 maybe within the next week to remain valid.
The better support line right now is the black horizontal support at $6,500, which from the past few months appears as a triple bottom for right now. I have marked those bottoms with the green arrows on the chart.
This would provide a solid descending triangle between the black horizontal line and the down-trending red line from the last few months.
The next support target would be the maroon horizontal line at $5,962 which would be a solid level from back in October of 2017.
The RSI is on the verge of entering oversold territory here and has also put in a slightly lower low on the indicator from the low on May 28th at 30.38 to the low yesterday at 30.33, signaling this trend still may have some downward momentum to go.
On the weekly analog Bitcoin chart I had warned that if price did not close above the 50 week moving average which now resides at $7,800, price could continue to head down into a longer bear trend.
Unfortunately, this did happen and the liquidation that began on Saturday afternoon could have been the acknowledgement of the trend beginning, not solely the news of the Coinrail exchange being hacked.
There’s a lot more that can be said about this trend and subsequent analysis, I can discuss that more tomorrow.
-More on vanddar.com
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