Receive all Cointelegraph news immediately in Telegram.
Given a slow news cycle as well as mixed short to medium term technicals, the market has been under some pressure over the past few days following yet another failed attempt to break above $600.
Analytics provided by BBA
The slow grinding recovery from the Bitfinex debacle early last week has continued over the past several days as it now appears as though the exchange will continue to operate, at least for the time being. That said, the bulls did hit some turbulence late Saturday into Sunday as price began dropping from its $580 support area down into the high $550’s. The selloff was short-lived, however, considering that price quickly recovered back into the $560’s in a matter of minutes, and is now challenging $570. Despite this speedy recovery back up into new resistance we think the market remains indecisive, and therefore range-bound, between the well-established $550 – 600 range levels.
Given that we are expecting a rather slow and uneventful week as we enter the heart of “back to school” vacation time, otherwise known as the “summer doldrums” or the “dog days of summer”, we think that the market will stay relatively stable between $550 – 600 over the short term. This time of year is marked by lackluster price action and low exchange volumes in the legacy markets, but this malaise has a tendency to seep into the crypto markets as well. If for some reason, however, we do see a breakout of this range then support at $520 and resistance at $630 should be significant enough to stop any potential runaway price action.
Despite our call for a relatively calm week in the bitcoin markets, we still want to take a look at a chart in order to make sure we are on the right track. We can see on the updated 3-day chart below of Bitstamp that although the Bitfinex hack catalyzed the major dump last week, the market was already heading down out of the broken symmetrical triangle long before that event. Also notice that said dump stopped on a dime and reversed right at the bottom of the support zone, as well as around the uptrend line and the 61.8% Fibonacci retracement level. Fast forward to this past weekend, though, and we can see that price was unable to get above $600, thus leading to another near term market structure top which is what likely caused the $20 pullback yesterday.
Moving on to momentum and volume it is clear that this current medium term countertrend move to the downside remains intact considering Willy and RSI are still not oversold, MACD has room to run lower, and we have a series of lower highs and lower lows working. Additionally, volume profile remains extremely thin down to the new 465 $ regional low, although the A/D line and exchange volumes indicate that there are not as many sellers as would be expected seeing as though price has been heavy recently. Finally, the 200 SMA is maintaining its reversal thus signaling that the longer term bull market remains intact, however we are still of the mind that the rangy consolidation that bitcoin has been in for the better part of the summer will continue for the foreseeable future.
BullBear Analytics is the longest standing cryptocurrency forecasters in the market. They started in 2010, doing technical reports in bitcointalk.org, and have evolved into a buzzing community of traders. Adam is BBA’s chief analyst.
Disclaimer: Please always do your own due diligence, and consult your financial advisor. Author owns and trades bitcoins and other financial markets mentioned in this communication. We never provide actual trading recommendations. Trading remains at your own risk. Never invest unless you can afford to lose your entire investment. Please read our full terms of service and disclaimer at the BullBear Analytics Disclaimers & Policies page.
Follow us on Facebook
For updates and exclusive offers, enter your e-mail below.
One fine body…
Thank you for contacting us! We will reply to you as soon as possible.
Thank you for your interest in our franchise program.
We are considering your request and will contact you in due course. If you have any further queries, please contact:
Reset letter sent.
Please checkout your mailbox for password reset details