Bitcoin Bounce Convergence at $7.2K and .65 Long-term Fib at $7K
On our usual hourly analog Bitcoin Bitfinex chart, I am looking at the nice new lows that we were provided early this morning all the way down to a low of $7,260 on the 5am EST candle. This is just short of the $7,200 level I was targeting yesterday, however that still could be in the works.
The bounce that occurred in price, appears to be due to the bottom of the pink down trending channel that we have been tracking for a few days now.
That turquoise 20 hour moving average has been restraining price pretty tightly on this downtrend, where there has been only 3 candles that have closed above there since Monday morning, the one at 1am last night and two earlier this afternoon.
Is this enough for any productive sustained rally? Probably not, as price has just closed back below that moving average at $7,510.
The $7,500 lime green line has been providing decent support the past 32 hours or so, but once again volume is dropping quickly. It’s been headed downhill ever since the pop around 8am EST this morning. Usually that means we are due for another big move one direction, and I cannot find a reason it would turn bullish right now, when the trend is still headed downward.
Price needs to make a higher high somehow if it wants to do something productive and that would mean a getting back above that $7,730 level. To the downside, well, a retest of the bottom of that pink channel is highly likely at $7,300 and then hope for big volume.
The indicators are all pretty neutral right now, however there is some strong bullish reversal divergence, but there is also some stout hidden bearish divergence as well.
On the daily analog Bitcoin Bitfinex chart, we get a much better picture for what is going on.
What I love here is that the RSI has almost tapped that purple up-trending line at 33.5. It might look like it is touching on the screenshot, but when I zoom in, it’s almost a hair off. If you then compare that to the price chart where the blue up trending line that connects past lows is...boom. That is a hair off as well.
This convergence of the support levels is encouraging to see and expect that we could get a nice bullish bounce off the $7,200ish level. The blue .786 fib level is giving me $7,179.
The fib level and blue uptrend line are also converging with the pink downtrend channel as well on about Saturday. Sunday, which could be another bastion for support.
Additionally, I have added a big Fibonacci retracement from the lows in Bitcoin back in 2014, all the way up to the peak of the highs in December of last year. Price has already been pushed down through the dark green .618 level on that metric however, we still have the .65 fib level at $7,034. If price does breakdown further, maybe we could expect a wick to that level and $7,200 to contain the bottom of the candle.
Once again there needs to be some big bullish volume to turn this around like we had seen on April 12th. Back than tax day was a major reason, however what may the reason be this time? There’s a lot of bullish rumors out there, so we will see what happens.
Also much like the last big bounce we had in April it took about 13 days for price to actually turn ship. I wouldn’t expect it to take as long this time around, especially if price is putting in lower lows on increasing volume.
The CCI is still in a sell zone right now, but is turning back towards the median, so its possible price could consolidate for a few days before testing those highlighted targets. The weekend is looking to be an exciting one!
The bounce that occurred in price, appears to be due to the bottom of the pink down trending channel that we have been tracking for a few days now.
That turquoise 20 hour moving average has been restraining price pretty tightly on this downtrend, where there has been only 3 candles that have closed above there since Monday morning, the one at 1am last night and two earlier this afternoon.
Is this enough for any productive sustained rally? Probably not, as price has just closed back below that moving average at $7,510.
The $7,500 lime green line has been providing decent support the past 32 hours or so, but once again volume is dropping quickly. It’s been headed downhill ever since the pop around 8am EST this morning. Usually that means we are due for another big move one direction, and I cannot find a reason it would turn bullish right now, when the trend is still headed downward.
Price needs to make a higher high somehow if it wants to do something productive and that would mean a getting back above that $7,730 level. To the downside, well, a retest of the bottom of that pink channel is highly likely at $7,300 and then hope for big volume.
The indicators are all pretty neutral right now, however there is some strong bullish reversal divergence, but there is also some stout hidden bearish divergence as well.
On the daily analog Bitcoin Bitfinex chart, we get a much better picture for what is going on.
What I love here is that the RSI has almost tapped that purple up-trending line at 33.5. It might look like it is touching on the screenshot, but when I zoom in, it’s almost a hair off. If you then compare that to the price chart where the blue up trending line that connects past lows is...boom. That is a hair off as well.
This convergence of the support levels is encouraging to see and expect that we could get a nice bullish bounce off the $7,200ish level. The blue .786 fib level is giving me $7,179.
The fib level and blue uptrend line are also converging with the pink downtrend channel as well on about Saturday. Sunday, which could be another bastion for support.
Additionally, I have added a big Fibonacci retracement from the lows in Bitcoin back in 2014, all the way up to the peak of the highs in December of last year. Price has already been pushed down through the dark green .618 level on that metric however, we still have the .65 fib level at $7,034. If price does breakdown further, maybe we could expect a wick to that level and $7,200 to contain the bottom of the candle.
Once again there needs to be some big bullish volume to turn this around like we had seen on April 12th. Back than tax day was a major reason, however what may the reason be this time? There’s a lot of bullish rumors out there, so we will see what happens.
Also much like the last big bounce we had in April it took about 13 days for price to actually turn ship. I wouldn’t expect it to take as long this time around, especially if price is putting in lower lows on increasing volume.
The CCI is still in a sell zone right now, but is turning back towards the median, so its possible price could consolidate for a few days before testing those highlighted targets. The weekend is looking to be an exciting one!
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