Skip to main content

Bitcoin's Price Is Back Above $4,000, But Is All-Time High in Sight?

It's safe to say Friday wasn't the most stable day for the (BTC/USD) exchange rate.
After news of exchange shake-ups in China triggered a wave of panic selling, prices fell below $3,000 for the first time in months. Overall, this was the lowest total observed on the CoinDesk Bitcoin Price Index since August 5, when a V-shape recovery saw prices rise all the way to $3,875.
Yet, just a few days later, the price is already back at that level, having gained 33% in three days.
The sharp recovery could be attributed to oversold technical conditions and to the relief offered by news that China’s exchange ban would not impact all forms of cryptocurrency trading.
But while the exact causes are uncertain, it seems safe to say the bad news has already been priced in by the market.
The recovery from the low of $2,980 followed by a bout of consolidation (ongoing) in the range of $3,500 to $3,800 over the weekend and move above the resistance of $3,900 (September 5 low) today further indicates there's confidence in the current market state.
So, is bitcoin out of the woods?
Price action analysis says bitcoin could be setting up for a solid rally to record highs, the likes of which it saw from mid-July. However, the bulls still need to clear some key technical resistance levels, before claiming victory over the bears.

Daily chart - 100-day moving average support & an oversold RSI

The price action witnessed over the last 48 hours is similar to conditions seen in mid-July, i.e. the dip below the 100-day moving average was short lived as the RSI (relative strengh index) was oversold.
At that time, the market saw a huge breakout, followed by a rally to record high of $5,000.
Still, the daily chart shows back-to-back Doji candles (on Saturday & Sunday), a candlestick pattern which shows indecision in the marketplace. A bullish reversal is confirmed if the Doji is followed by a positive candle. If bitcoin ends on a positive note today, preferably above $3,958 (50-day moving average), a bullish reversal would be confirmed.
If bitcoin ends on a positive note today, preferably above $3,958 (50-day moving average), a bullish reversal would be confirmed.

Outlook

The trend line drawn from September 2 high and September 8 high will offer resistance around $4,250 levels. A break higher would open doors for fresh record highs in bitcoin.
View
  • A bullish reversal confirmation followed by a break above $4,250 would add credence to the rebound from the 100-DMA and shall boost the odds of the digital currency rallying to fresh record highs above $5,000.
  • Only a daily close below $3,600 would revive the bearish view.

Comments

Post a Comment

Popular posts from this blog

How Blockchain Could Help Tech Giant Cisco Reboot

Cisco is changing. The technology firm best known as the supplier of enterprise computer hardware has seen a slow, steady decline in revenue from some of its core products. As a result of an increasing number technological services being virtualized, and the storage of information moving to the cloud, the $158bn firm has been  restructuring  and exploring new ways to capitalize on connected devices. But amidst this change in identity, it's in identity itself where some of the California-based company's most interesting new experiments are taking place. With a series of early stage blockchain  projects , Cisco is now pushing even deeper into what could end up being much more than a way for employees to prove who they are across subsidiaries. In conversation with CoinDesk, Robert Greenfield IV, Cisco software engineer and executive team lead of the firm's Connected Black Professionals resource group, explained how several blockchain projects have evolv...
Post a Comment
Read more

Duncan Logan just tweeted that he's on board Electroneum

I have been a buyer and holder of bitcoin and Etherreum for a long time but this will be the first ICO I buy into--Duncan Logan. What is Electroneum? Electroneum (ETN) is a cryptocurrency that can be mined with a smartphone, requiring almost no technical knowledge or prior experience. This sets it apart from other cryptocurrencies (like Bitcoin) which require expensive hardware and technical know-how to mine. Electroneum’s unique mobile mining experience allows anyone with a smartphone to earn ETN coins by letting the miner app run in the background. It was designed specifically with mobile users in mind, thereby appealing to a potential market of 2.2 billion smartphone users around the world. Unlike other cryptocurrencies, Electroneum has a user-friendly, beginner-oriented interface that allows users to seamlessly transfer ETN coins between one another, check their balances, and mine coins. Being a  cryptocurrency , Electroneum is created, held, and spent electronical...
Post a Comment
Read more

Police Bust Alleged $13 Million Crypto Pyramid Scheme

Police in China's northwestern city of Xi'An have arrested the founders of a claimed nationwide cryptocurrency pyramid scheme that allegedly amassed 86 million yuan ($13 million) from over 13,000 people. According to a report  from local media source Huashang News, Wednesday, the scheme launched in March 28 this year after months in preparation by a primary suspect who has has the surname Zheng, as well as three other accomplices. The report cited an investigation from the police who said the scheme used a cryptocurrency called Da Tang Coin (DTC) that is linked to DTC Holding  - a firm under the suspect's control and registered in Hong Kong - to allegedly hoax potential members of the pyramid scheme. In various promotional events in multiple cities in the country, the scheme claimed that new members can make 80,000 yuan (roughly $13,000) per day with an initial investment of $480,000 to purchase the DBTC at $0.50 per token, according to the report. These promises o...
Post a Comment
Read more