investigator
Short

BTC WEEKLY CHART: "The Panic Zone" Where's the bottom?

BITFINEX:BTCUSD   Bitcoin / Dollar
544 4 6
We're right on time for a correction. See my previous estimates linked below.

First, the blow-off-top at $500 was way beyond my expectation. It launched with the greatest volume we've seen since the beginning of the "Panic Zone" plunges and much more than the surge to $1200. The combination of lower panic volume in the second plunge and huge exuberance in the most recent rally bode well for a solid breakout attempt above $500 in the next surge up. But first, this market has to establish a new bottom base. I would be extremely surprised at a turn around starting at this level. If you notice the down volume in this plummet has not been large. That means there are a lot of people still holding BTC purchased between $330 and $500. These are going to be demoralized sellers later on. I see a whole lot of panic coming.

Today there was a bottom breach in top tier support. There are essentially 3 more support levels. I expect the panic to set in at a break in the bottom of the next support layer which starts at roughly $275 down to $240. You may notice that I moved the PANIC ZONE label up a layer from where it previously was a month to 6 months ago. The panic selling will start soon. What we have seen so far from $500 down to $330 has not been panic selling. It has been somewhat structured profit taking. From $218 down is now the SUPER PANIC ZONE. If prices enter this zone then capitulation selling will mark the bottom. It will be brief and V shaped on the Daily chart . For the most part I think prices will level out in the $218 to $275 range and stay in this range for at least the next quarter year. Maybe longer. Get out your favourite Cat Fish Pole because were about to start doing some bottom fishing. I wouldn't be surprised to catch some wiggly youngin's in the sub $200 range and if we're lucky, low $100s.

Hang on to your hats. This drop will make your eyes tear.

Related Ideas

I think 300 has been established as hard support, tested over and over. I do not only look at the price chart, but also at market cap: 3bn is somewhat the overall amount that the network absorbed.
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oaksacorn
a year ago
Well if the yellow arrow history repeats itself, we break up through the dottted trend line.
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mcambron001
a year ago
Does your analysis still stand?
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investigator PRO mcambron001
a year ago
My analysis is based on a very slow moving weekly chart. If you draw a red dotted support line under the current up trend starting at around August 1, it would create a wedge with the dotted blue line which comes to a termination in a few weeks. This creates an inflection point that either can break up or break down if we reach the end of the wedge. What are the chances of an up side break through the wedge? Is the better question. Fundamentally there is a strong down side pressure in the USG-DOJ fire sale of it's remaining Silk Road BTC confiscation. The strong upside fundamentals are the NY based BTC fund kick-off which is a bit further down the road. We've seen some price consolidation in the last week or so with the second support tier at $300 holding. There have been a couple of attempts to test support but nothing major yet. Top side resistance is at $350. We may bounce in this $50 range for a while. There is no compelling evidence that my prediction is wrong. You could also argue the opposite but I would bet my bottom dollar that the people that impulsively bought in at $450 to $500 are eagerly waiting to get back out. It's just a question of how much they can stand the anxiety.
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