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Market Commentary (BTC):
Despite the fact that the bitcoin price was able to push up to the 590 $ near term OTE short zone resistance yesterday, a failure to break above there caused another overnight selloff back down to 580 $. Now we are once again treading water around 585 $, as we did for most of the day yesterday, although we will say that a series of higher lows over the past five days still has us leaning slightly bullish for the time being. While we are skeptical of a breakout above 600 $ in the next few days, we do think the bulls make a run for it by the end of the weekend. Another failure there would likely mean we revisit the lower half of the 550 - 600 $ trading range, but as per the ProTrades below we would be buyers of that dip.
Today we want to return to our favorite medium term chart to see if we can glean any clues as to timing and directionality of the next move. We can see below the SCMR is trying to paint green candles but there are some neutral ones scattered in there as well. Also note that dynamic support is still building around 570 $, which is also where a volume profile mini-PoC sits, and is right in the middle of the current pivot zone. Additionally, the 9/18 EMA cross is starting to turn back to the upside, the 200-period SMA is still rising but will be resistance on the way back up, and there is a large volume profile notch that needs some filling in just above 600 $.
Moving on to momentum and volume, notice that Willy is above the centerline but is rapidly approaching overbought territory while price remains relatively flat, RSI is above the centerline as well but has stalled out, and MACD remains pinned near zero as the MA's continue to flatten. Additionally, despite the fact that the A/D line is still generally trending slowly higher, we have seen a slight dip over the past day or two which indicates there could be some distribution happening in the upper half of the aforementioned 550 - 600 $ trading range. Finally, exchange volumes remain unimpressive signaling a lack of conviction from either the bulls or the bears for the time being.
Given a mixed technical picture and poor seasonality we think the market will continue to chop around between 570 - 590 $ through the middle part of this week. That said, we think there is a decent shot at an upside test of 600 $ prior to a move back down to SCMR support at 570 $ early next week. While the dog days of summer press on, we remain neutral and patient at current levels considering price action is anemic and risk/reward profiles are unattractive on both sides of the market.
GLGT!
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