investigator
Short

Bitcoin Panic Zone

BITFINEX:BTCUSD   Bitcoin / Dollar
321 3 3
I'm a big BTC enthusiast. I think it's a wonderful and very useful invention. I think the long term prospects of value are good. However, I am also pragmatic. BTC is in the final throws of a bear run that started at the beginning of the year, had a brief respite in April             and since has resumed the bear posture. The true test will be at $340. A plunge through this second to last support layer is ominous. I'm looking for buying opportunities in two regions. $340 holds and price action begins to consolidate above the moving averages illustrated by the deep red moving average. Or, in the $100 to $135 range where final long term price support still exists.

I don't have great hopes for a $340 hold. This price support level has a very small volume history of trades. Most of the people that bought at this level have sold at much higher prices.

Fundamental factors are at play. The BTC mining activity has far exceeded the expectations and is currently debasing the value. This is a relatively short term problem due to the finite ceiling of circulation. Also, adding downward pressure are the retailers that accept BTC payments but then transfer this back into their native currencies. This is a longer term fundamental pressure but it does get alleviated as consumers buy back cheaper BTC to replenish the cycle. As long as the price of BTC continues to slide, consumers will be reluctant to buy back in.

The wave and cycle theorists are all full of hot air. BTC market capitalization and usage is far too premature to predict any future performance. It will be the fundamentals that dictate future value. Right now the fundamentals are not so good. Technically, MACD has a big wide downward pointing open mouth and shows no sign of a bottom action.
You may be right, but I think it's time for us to visit the top of that channel you drew first. Selling pressure is getting weak down here and BTC is breaking out of the short term downward channels to the upside. The bears can't keep this up forever. There needs to be a retrace somewhere, and this seems like a good place for it. We won't go much lower, if at all, before the rise.
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This is a weekly chart and my comments are about the long term, in BTC terms that's about 6 months. There are possible scenarios for the short term rallies on the 1-day and even the 4-hour charts but even there the down trend has been relentless in the past weeks. Unless you have implemented automated trades with exchange API's, trade execution manually would amount to multiple sleepless nights. I contend it is not the trader "bears" that are making this market. It is the action of the Bitcoin miners and the major retailers that are forcing long term downward pressure on the price. The trading channel illustrated in the current down trend is a linear regression calculation from the most recent weekly high to current price. The price could easily become stable and move sideways over the next month to reach the top of the channel. A price rise is not required.

Personally, I like to sleep at night so in my own investing strategy I use the weekly and daily charts to dictate when it's safe to play the 4-hour chart. Currently I have sell signal indicators active on all three charts. Using this strategy I have missed some minor moves but never have missed a major. The major moves, got in at $100 got out at $1000, got in at $400 and got out at $600, have dwarfed the minor moves in profitability.
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AdrianThomas investigator
Looks like your $100 target area is firmly in play, unless this is a bear trap break over the weekend where trading is thin.
Well done.
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