*PLEASE READ MY ENTIRE DESCRIPTION. THIS IS VERY COMPREHENSIVE.
For the last few months I have been incredibly bored with Bitcoin, and almost completely lost faith in it.
Bitcoin meet ups have been desperately underpopulated and only popular to old crowds.
I myself am a frequent of Bitcoin Center NYC. What strikes me peculiar is the fact that the best opportunities exist where absolutely no one is looking. I think in our winter of discontent, pun intended, that we all forgot the true underlying value to Bitcoin. And it will take a true market rally, and sustained higher price to surely help reinvigorate Bitcoin interest, 21 anyone?
On to the Analysis:
What I see here is a unique opportunity to buy on a very likely short term pullback, probably no more than to $233. Ever since the epic crash earlier this year, we have seen a vast fluctuation of prices both driven by the speculative madness of the Bitcoin crowd, and those market manipulators who can move the market. What is unique is for the last month the market has decisively done a slow but steady run up with no catalyst driving it, news doesn't drive a depressed community, and continued to rise to the 50 Day EMA (an important resistance area.
Tech:
I have coded two indicators to look at the condition of Bitcoin currently:
Multi-momentum:
I have added 3 time frames to the stand momentum indicator
1. Short term - 10 Days
2. Intermediate - 21 Days
3. Long Term - 65 Days
What is unique about momentum currently is that this time not only are both short and intermediate term Vol positive and bullishly postured, Long term momentum is very close to becoming positive. If this lead up continues this way, Bitcoin's long term momentum will become positive (hopefully short and intermediate will be to, this would create the necessary conditions for a rally. If Bitcoins can get out of their depressive state and start buying, in the long run we could see a move back to 300 (unfortunately since Bitcoin went under 300 it seems Bitcoiners have been a mix of bi-polar and apathetic).
Stdev Sizzle:
-This is a relatively simple concept
1. Take the 21 period standard deviation
2. Take the 5 period volume weighted moving average of the 21 period standard deviation
3. The red line (the average) becomes a signal line). Therefore stronger movements in price (increased volatility are more likely when the blue line (standard deviation) is above its 5 day average
4. Looking at the graph you will see relative to the time frame I referenced deviation is it an all time low.
5. Simple interpretation: There will be an increased amount of volatility in the near future.
Linear Regression
-The simplest way to think about this is best fit line with 2 more lines plotted at 2 standard deviations up and down.
As as it maintains, any moves above are overshoots, and possible short opportunities, and vice versa
Price Targets:
Bullish: $242-$250 *Warning, waning momentum at $242 will reverse to the regression line.
*Warning Bitcoin is at 2 Standard deviations of its 21 day mean. That means there is a less than 2%
probability that bitcoin can exceed about $242. As I said. Waning Bullish momentum at $242 will reverse.
The Best opportunity to buy is on a reversal to $230, and average down to $226.
Bearish: $226-$230
For the last few months I have been incredibly bored with Bitcoin, and almost completely lost faith in it.
Bitcoin meet ups have been desperately underpopulated and only popular to old crowds.
I myself am a frequent of Bitcoin Center NYC. What strikes me peculiar is the fact that the best opportunities exist where absolutely no one is looking. I think in our winter of discontent, pun intended, that we all forgot the true underlying value to Bitcoin. And it will take a true market rally, and sustained higher price to surely help reinvigorate Bitcoin interest, 21 anyone?
On to the Analysis:
What I see here is a unique opportunity to buy on a very likely short term pullback, probably no more than to $233. Ever since the epic crash earlier this year, we have seen a vast fluctuation of prices both driven by the speculative madness of the Bitcoin crowd, and those market manipulators who can move the market. What is unique is for the last month the market has decisively done a slow but steady run up with no catalyst driving it, news doesn't drive a depressed community, and continued to rise to the 50 Day EMA (an important resistance area.
Tech:
I have coded two indicators to look at the condition of Bitcoin currently:
Multi-momentum:
I have added 3 time frames to the stand momentum indicator
1. Short term - 10 Days
2. Intermediate - 21 Days
3. Long Term - 65 Days
What is unique about momentum currently is that this time not only are both short and intermediate term Vol positive and bullishly postured, Long term momentum is very close to becoming positive. If this lead up continues this way, Bitcoin's long term momentum will become positive (hopefully short and intermediate will be to, this would create the necessary conditions for a rally. If Bitcoins can get out of their depressive state and start buying, in the long run we could see a move back to 300 (unfortunately since Bitcoin went under 300 it seems Bitcoiners have been a mix of bi-polar and apathetic).
Stdev Sizzle:
-This is a relatively simple concept
1. Take the 21 period standard deviation
2. Take the 5 period volume weighted moving average of the 21 period standard deviation
3. The red line (the average) becomes a signal line). Therefore stronger movements in price (increased volatility are more likely when the blue line (standard deviation) is above its 5 day average
4. Looking at the graph you will see relative to the time frame I referenced deviation is it an all time low.
5. Simple interpretation: There will be an increased amount of volatility in the near future.
Linear Regression
-The simplest way to think about this is best fit line with 2 more lines plotted at 2 standard deviations up and down.
As as it maintains, any moves above are overshoots, and possible short opportunities, and vice versa
Price Targets:
Bullish: $242-$250 *Warning, waning momentum at $242 will reverse to the regression line.
*Warning Bitcoin is at 2 Standard deviations of its 21 day mean. That means there is a less than 2%
probability that bitcoin can exceed about $242. As I said. Waning Bullish momentum at $242 will reverse.
The Best opportunity to buy is on a reversal to $230, and average down to $226.
Bearish: $226-$230