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February 12, 2015, 05:37:08 AM |
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Consistent sideways action usually represents stability in a normal trade scenario, though in the case of bitcoin, such movements are always alarming. We are seeing demand in the market, while the supply from the miners’ has been steady. There needs to be a notable increase in the way that bitcoin is marketed among end-users. At this point, user adoption needs to be crossed above the rate of inflation. This theory supports a bull run which we haven’t seen lately.
The market’s steadiness meanwhile is daunting; we saw similar events unfold last year when the bitcoin price trended horizontally continuously after a shakeup from its 1000-something peak. The sideways movement eventually resulted in a crash. We reviewed the order books of multiple bitcoin exchanges and noticed that majority of the trades were hedged towards a fall to the lower 200s – perhaps predicting a shakeup in the coming weeks.
February 11th Bitcoin Trading Session
BTC/USD successfully retreated from the intraday bottom around the 214 mark, marking a slightly better day. The price meanwhile opened at around the 223 point, surrounded with all sorts of micro-trades to ensure a continuation in the prevailing consolidation. A small amount of sell-offs during the early hours brought the price to a low 219, but more influential buying orders later lifted the market towards the north. The price continues to trend peacefully around the 221-224 area while trading volume remains to be lower than usual.
What to Expect Today?
Today, the market is displaying the same sideways consolidation, changing nothing for a long-term outcome. Due to a small amount of micro-buying orders in last few hours, the near-term landscape for bitcoin has changed to bullish. As you can see the 4H Bitfinex chart above, the price clearly has its head towards the north, attempting go above the 200-H SMA (the purple curve).
In the meantime, the technical indicators are also suggesting a near-term bull run. The MACD blue curve is going missionary on the saffron signal line; the RSI is hoping to float above 50 – a neutral bullish region; while the price is clearly above the 50-H SMA curve (the black line).
To extend its bullish correction further, the price needs to break above the 233-resistance level. If it does, the pressure could rise once again towards the 248-250 area. Failing to do so will bring the 210 bottom back in sight, while it is likely that the market will continue to bounce like a ball between these two ultimate thresholds.
Conclusion (On Daily Charts)
Current Mood: Bullish-Neutral
Moving Averages: Neutral (6 Buy 6 Sell)
Technical Indicators: Buy (3 Buy 0 Sell 8 Neutral)
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