Rashad

WATCH CLOSE NEXT FEW HOURS! BTC BREAK DOWN OR BUY IN.

BITSTAMP:BTCUSD   Bitcoin / Dollar
1030 0 2
Since the establishment of the upward channel, BTC has bounced off of the support line 3 times. Typically this is a bullish sign. Likewise, it back up to ~390. Since the Bitstamp mishap, there was a small recovery back to about 387.50, but since then down again.

I have modified my stochastic RSI to give a lot more accurate buy and sell signals, stochastic length is double RSI length, and %D is 3 times %K. You can see many examples on my chart where %K heads towards %D but doesn't quite cross. Afterwards it keeps rising. What this shows now then is clear bearish behavior. The divergence between %K and %D is quite similar to when BTC fell from 450. What interests me in particular is that %K has headed into the oversold range. BTC is very weak right now at support. If BTC heads up again from the support line, IT COULD BE A FANTASTIC BUY IN. A buy signal in stochastics in the oversold region followed by a move above 20 is very bullish . However I will expect a buy signal to be generated above 20 as more sideways movement continues. The early part of the weeks rally was a weak rally as the RSI stochastic stayed well below 50. Keep in mind the strong rally's, like the one that headed to 450, happen where Stochastic RSI heads upward beyond 50.

Conclusion:
Watch this chart for a breakdown and continued bearish activity. I am not yet confident to open up a short position until I see a breakdown happen, likewise I will not increase a long position until I see another buy signal. My recommendation would reduce a long position and wait for further data.

Also on a side note I am long term bullish! This is a short term opinion.

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