This weekend has been nothing but boring in terms of price action. After a Sunday bear trap for the second time this weekend Bitcoin’s price dropped to trhe low $360 only to bounce right back up to the $370 levels. In our last technical analysis we analyzed the positive divergence which was forming between the OBV and the price. This divergence signaled major price movement and a possible trend reversal, while no major market action occurred just yet does not mean that it won’t happen any time soon.
The chart above shows the breakdown of the last support level, which was right around $375. The last drop from $375 is significant because it signals that the bears are in control since the support zone did not hold. When such technical indicators form, traders will usually short the security in question and additional sell pressure is expected. At this point it is unlikely that we will see the price climb much higher as support is barely holding.
TReano from tradingview points out an interesting idea for the current market situation. He compared the current price action to that of 2 years ago right after the bubble burst. “The picture we are plotting currently reminds me of the 2014 run after the big decline.” While it’s true that one can find patterns anywhere on the chart, in both scenarios the Bitcoin market was facing adversities. Back in 2014 the elephant in the room was the bubble bursting and the price crashing to $300; currently the civil war in the Bitcoin community is the elephant in the room, and the debate over the blocksize is causing hardships for Bitcoin’s launch to the moon.
Read More:
http://themerkle.com/coins/bitcoin-technical-analysis-2116/
