Paypal news as everyone is aware of, is good. It is good for adoption and good for fundamentals. As a technical analyst, I pay special attention to how market reacts to news. Lets be real, the ad is a BFD, big fucking deal, for rumors-ville, it pretty much suggest they will start adapting bitcoin into their existing business model. For a high speculative interest product like bitcoin, "buy the rumor, sell the news" works pretty darn well.
Hope everyone had a good weekend. Bitcoin prices on the other hand have completely retraced the big green bar on the hourly from two days ago. This is bearish because market rejected 3000CNY/490USD level; market didn't even bounce that much. Now, all the people who bought btc up to 497 are all wrong.
At this juncture, we are going to retest 2900CNY/467USD. Will the second time retesting this area hold? I do not know. If recent market choppiness is any indicator, we should bounce in the short term.
Bitcoin prices for the last 2 days have been constrained within a bear flag. If you are not familiar with the flag formation, check out the flag guide. At this point, there is nothing to do but wait for the next breakout. As you know, bear flag is a continuation pattern, kind of like a pause in the market before continuing the trend. Target is 440 on the usd or 2800cny, the previous low.
Back to Bitcoins after labor day weekend. Market sold off during the weekend, Chinese exchanges lead the way down. This is interesting because Saturdays and Sundays are times in which volumes are thin and prices are trendless. But not this week, we pushed down key supports over the long weekend. Price action trumps all, but its something interesting to think about.
Market doesn't seem like it is holding well at this level, we are going to retest previous lows of 441. In the bull's case, market needs to form a double bottom or a W shaped pattern to stop the bleeding.
Update before the weekend. We are now in consolidation inside of a triangle. This is more clear on the daily, volume has dried up, price action is choppy. We are waiting for this one to settle and breakout either up or down. My bet is down because trend is down. But the possibly of a retest to 550 or so is possible and likely. Have a good weekend, follow me on twitter @ibankbitcoins
Bitcoin market update:
Still in consolidation, I spotted a head and shoulder chart pattern yesterday and it broke down since. The target is 3065 on OKcoin or ~500-495 usd. I want to emphasize that all projections and patterns don't' work very well during times when volumes are low.
Bitcoin Market Update:
Market was forming a topping pattern on the hourly that I pointed out on tradeview yesterday.
Market is now experiencing downward pressure, but still in consolidation. Price action is choppy and volume is low. Look at the hourly chart from this week, this shit is not tradable. Its difficult if not impossible to profit from this random motion.
Bitcoin Market Update:
Nothing much has changed since 2 days ago, we are range bound between 520-495. While that is a big range, the volatility from recent bear trend decreased. Overall volume is still above average, but lower.
Since we are consolidating now, we can assume that traders have accepted this price level; they deem this level as "fair market value" for the time being. If not, we would have a reversal or more sell-off. While I cannot predict when or which direction is next move, the likely hood of it going down is higher since we are in a bear trend.