I'm still long term bullish on Bitcoin, but the recent price rises have been extremely fast and in my opinion over value the asset now.
If you look at the chart (which is based on another chart that was published). You can see a double top forming as well as a flag. Adding in the MACD we have a lower high than we had in late November the last time we touched $1200 as well as a bearish divergence down, negative histogram and the MACD/filter lines crossing (as well as the MACD line going below zero).
The fall might not be as far as I expect, it has never been as long or as deep as I've thought before, but we are definitely going to see some further falls back to $900 before it either goes lower or stabilises around the $900/1000 mark.
Comments
cresce
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Excellent spot that div. What I find intriguing is that every "so-called-pop-of-theBTC-bubble" it sets a higher low. That is more like the definition of an uptrend :-D Let's see where the low is set this time. The last 3 "bubbles" we got through it retraced 50% and used that new bottom to jump off up again. It's also funny imho that every bubble screamer never realises that all the bubbles we've seen in the past only go up once and after that never come back. Now can't tell if its a bubble or an adoption curve we;re watching. Neverthelss also long term bullish :-) Thanks for your TA sharing.
TheSleepyTrader
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No worries! As I mentioned I'm long term very bullish on Bitcoin (I got my first coins at about $10 so I'm happy even if we go back to $400). You are right though that every time we've had a major fall it has always been a higher lower than before and if you look at the weekly or monthly data it is still very bullish.
Short term I think we've seen volumes and momentum falling so I'm pretty sure we could be down at $900 or even $800 today/tomorrow. Especially with the announcement from China (it's a mixture of positive and negative news depending how you read it so it will be interesting to see how that gets reported in mainstream media as that will be a driving factor of this movement).
I still feel that right now Bitcoin is slightly overvalued and I would be happier with it consolidating around $800-900 for now while more services and transaction uses are built up. Rapid rises are not good for it as a payment mechanism.
TheSleepyTrader
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I've also just noticed the divergence on 4 hour ticks and the MACD has crossed over on the 1 day ticks as well. Will be interesting to see what happens this weekend!
MarkW
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I'm looking at it through Elliott wave analysis eyes and wonder if it's triangulating prior to a final thrust higher, possibly about $1500, after which I would expect a fib 61.8% retracement to around $575? I like the idea of bitcoin, but the volatility speaks low distribution and not enough pure transactional usage as yet
TheSleepyTrader
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I haven't looked at these indicators - Do you have a chart with them on? I think you could be right with a low of about $600 but I suspect we'll see it in the $800-900 for now possibly with drops lower.
MarkW
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Hi nox120, no charting done except in my mind, so not a serious prediction, just an idea looking at price action to date. When price was lower I thought bitcoin might be looking at $1000, now am thinking $1500 if any bullishness remaining? But if final thrust materializes is likely to be swift and probably untradeable. Could just as easily be on its way down from here, just my gut reaction says otherwise for now?