Norway


Bitcoin’s -percent recovery from the 14- low yesterday may have opened the doors for short-term consolidation.

The leading cryptocurrency by market value dropped through the support of the trendline connecting the August 2015 and August 2016 lows and fell to $3,474 yesterday – the lowest level since Sept. 17, 2017 (prices as per Bitstamp). At that level, BTC was down 38 percent from the highs above $6,0 seen two weeks ago.

The drop was short-lived, however, and prices closed yesterday (as per UTC) at $3,939 – well above the trendline – validating the oversold conditions reported by the technical indicators. As a result, a bout of consolidation could be in the offing.

At press time, BTC is changing hands at $3,920 on Bitstamp, having clocked a high of $4,069 earlier today.

The 15 percent recovery, though, may out to be a “dead cat bounce” if the long-term trendline support, currently at $3,830 is again breached. Meanwhile, the prospects of a stronger corrective rally would improve if prices find acceptance above $4,000.

4-hour chart

The bullish divergence of the relative strength index (RSI) and the falling channel breakout in the 4-hour chart indicate a bearish-to-bullish trend change. As a result, a stronger recovery rally toward $4,461 (downward sloping 50-candle EMA) cannot be ruled out.

Gains above that level may remain elusive as the stacking order of the 50-candle EMA below the 100-candle EMA, below the 200-candle EMA indicates the path of least resistance is on the downside.

Daily chart

Over on the daily chart, the RSI has created a bullish divergence (higher low). That pattern would gain credence if the RSI moves above 30.00 into the undersold territory.

The primary trend, however, would remain bearish as long as both the 5- and 10-day EMAs are sloping downwards.

Weekly chart

As seen in the above chart, BTC is now trapped between the former support-turned-resistance of the 200-week EMA, currently at $4,174, and the three-year-long rising trendline support. Acceptance below the trendline support of $3,830 would invalidate the signs of revival seen in the 4-hour and daily chart.

View

  • BTC’s defense of the long-term trendline support could be a sign the sellers have run out of steam. As a result, prices could consolidate around $4,000 for the next day or two.
  • A break above the psychological hurdle of $4,000 would add credence to bullish setup on the 4-hour chart and open the doors to $4,500.
  • On the downside, a move below $3,830 (trendline support) would allow a re-test of yesterday’s low of $3,474.

Disclosure: The author holds no cryptocurrency assets at the time of writing.

Bouncing ball image via Shutterstock; charts by Trading View 



Source link
thanks you RSS
( https://www.coindesk.com/bitcoin-price-bounces-15-after-14-month-low)

LEAVE A REPLY

Please enter your comment!
Please enter your name here