The Litepresence Report on Cryptocurrency
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PaulConventionWV
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Any ideas on what the bottom will be?
This decline really seems quite fickle because there was no bad news. Is it already done going down?
This decline really seems quite fickle because there was no bad news. Is it already done going down?
I have to agree with you. I think we're entering that despair part of the chart before the rebound. It appears to be a shakeout.
Fib lines indicate 480 could be the next stop according to others...or it could never reach that and bounce any time.
newbitech
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looking at bitstamp chart
keep an eye on the weekly RSI, this thing has NEVER been oversold. I'd be looking for a break of the low RSI (not price) established on the week of april 6 2014.
Watch how the RSI on the weekly interacts around the 42-43 level. if that breaks, I believe the RSI will dip below 30 for the first time.
We have once again increasing volume into price weakness.
Looking at the daily RSI, We are seeing the RSI H&S pattern being confirmed and the daily could ride below the oversold level for some time as the longer term strength indicator begins to assert itself with a reversion to the mean.
The day trade patterns on the 4 hour 1 hour and 15 minutes chart paint a grim picture of large chunks of the asset being dumped at any moment. It would be difficult to be long in the short term on these movements.
As for buying opportunities, there looks to be some token support in the 420-450 range, but volume at those levels indicates more exhaustion in the sell off rather than any kind of conviction buying.
The price indicator at this point is the weakest indicator due to the fact that the bubble did not allow the price to be established in the range from 200-900. The bubble did find some support at the 600-900 range after collapsing, however that range has failed several large volume upward tests.
To reiterate, the weekly RSI has never been oversold. I'll be looking for buying opportunities after the weekly RSI rebounds either off the 42ish level or after it takes a trip into oversold territory. Whatever the price may be.
I'm calling for at the least a retest of the closing low of 416, week of April 6. Failing that retest, and I think there are is a 50/50 chance that happens, the next level is 260ish the coming out party high. It will depend on how long the RSI stays oversold after 416 support collapse.
The best case for people looking to make a sound long term investment (in terms of risk/rewards) is to pick up in the range of 260-416.
keep an eye on the weekly RSI, this thing has NEVER been oversold. I'd be looking for a break of the low RSI (not price) established on the week of april 6 2014.
Watch how the RSI on the weekly interacts around the 42-43 level. if that breaks, I believe the RSI will dip below 30 for the first time.
We have once again increasing volume into price weakness.
Looking at the daily RSI, We are seeing the RSI H&S pattern being confirmed and the daily could ride below the oversold level for some time as the longer term strength indicator begins to assert itself with a reversion to the mean.
The day trade patterns on the 4 hour 1 hour and 15 minutes chart paint a grim picture of large chunks of the asset being dumped at any moment. It would be difficult to be long in the short term on these movements.
As for buying opportunities, there looks to be some token support in the 420-450 range, but volume at those levels indicates more exhaustion in the sell off rather than any kind of conviction buying.
The price indicator at this point is the weakest indicator due to the fact that the bubble did not allow the price to be established in the range from 200-900. The bubble did find some support at the 600-900 range after collapsing, however that range has failed several large volume upward tests.
To reiterate, the weekly RSI has never been oversold. I'll be looking for buying opportunities after the weekly RSI rebounds either off the 42ish level or after it takes a trip into oversold territory. Whatever the price may be.
I'm calling for at the least a retest of the closing low of 416, week of April 6. Failing that retest, and I think there are is a 50/50 chance that happens, the next level is 260ish the coming out party high. It will depend on how long the RSI stays oversold after 416 support collapse.
The best case for people looking to make a sound long term investment (in terms of risk/rewards) is to pick up in the range of 260-416.
PaulConventionWV
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The fact that it didn't bounce at 500 and is crawling along support indicates that there is more downside, possibly to 450. After that, who knows. It could be the final capitulation point, but if it's not, then we're in for a crisis.
Not saying that's likely. I really don't know, but 440-450 are definitely possibly support areas that could push the price in the other direction.
How do you know what volume will be before we get there?
Also check this guy out again. He's talking about that 61.8 fib line as well...
https://www.tradingview.com/v/HM51G...il&utm_campaign=notification_follower_comment
newbitech
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I was talking about the volume at support.
He is using intraday highs and lows on the daily moves for his fib study, which is fine.
On the weekly close, we are sitting on the 61.8 retrace for the weekly closes right now at 508, and has been tested already. Your thin volume green candle on the week of 4/13 is the last support level range between the open/close for that week from my analysis 416-500.
There is suspicion right now that the Ethereum developers are causing this drop. They raised 30K of BTC so far and that is close to the volume currently.
But people don't care about conspiracy. Just numbers. So if all targets are busted thru in the 400 range, the double-bottom reverses around 342 according to our group chart fegs.
Long story short...we are either close to the bottom now, or the next number we hit is 425. After that will be 350 range.
But people don't care about conspiracy. Just numbers. So if all targets are busted thru in the 400 range, the double-bottom reverses around 342 according to our group chart fegs.
Long story short...we are either close to the bottom now, or the next number we hit is 425. After that will be 350 range.
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amonasro
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The selling has slowed a bit, leaving the market reeling, oversold and catching its breath. While I think $450 is possible I wouldn't set buy orders that low. I saw a market sell for 1000btc on Bitfinex yesterday. One thousand bitcoins at once. Why in god's name would you sell that many with one click--it would tear through the orderbook like a hot knife through butter.
Regardless we don't really know the reasons people sell... Fundamentals are better than ever so I wouldn't be surprised at a strong bounce.
Regardless we don't really know the reasons people sell... Fundamentals are better than ever so I wouldn't be surprised at a strong bounce.
newbitech
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What is your time scale? I ask because on the weekly time scale, selling has been ramping up week over week for the past month month and a half. Volume overall hasn't been that impressive since spring, and I get the sense that a sell off is just getting underway.
Technically, we haven't seen buying volume outpace selling volume as a trend since the start of this last bubble. There was a very low volume impasse at the end of the bottom of the bear move off the bubble, and then what appears to be a head fake move off that bottom of the triangle.
As far as oversold on the daily rsi, i had mentioned a couple days ago that the daily RSI may ride below the oversold level as the longer term (weekly) strength indicator asserts its influence with a reversion to the mean. We see the daily RSI riding below the oversold territory for several days now. Short term trends are always going to be found within longer term trends. In this case, daily RSI is within the context of weekly RSI. Here is a nice link explaining some guidelines for technical trading. http://stockcharts.com/school/doku....s:john_murphy_s_ten_laws_of_technical_trading
As far as dropping 1000 BTC at once, consider the same works in the opposite direction. IF someone thought that BTC was going to $100,000, (and had the money to spend), it would be easy to rationalize buying 1000 BTC at once from the price range of $300 - $600.
On the flip side, someone who is in at an average price of $400 and expects the price to dip below that level would be cutting their losses by dumping at $450, even if it drives the price below $400 in the sell.
Assuming that the person who made the trade isn't throwing their money away, it is likely those 1000 BTC sell is creating a nice profit for someone who had the opportunity to obtain those BTC for much less than $450, so while they didn't maximize their profit by doing several small sells, they did cash out of their position without losing. The motivation would be 1.) don't lose capital, 2.) lock in profit, 3.) capital divestment
I also believe there will be a bounce, but a technical bounce. Honestly I don't think there are any trend busting fundamentals being reported. I am not an insider obviously, but the news I am hearing isn't that inspiring. For instance, where are the articles about the uptick in small transactions that would indicate broad consumer adoption? We are still hearing about merchant adoption and that quite honestly is going a tepid pace. I have to believe that merchants are weary of implementing the technology if the evidence of consumer adoption is not that impressive.
Not trying to sound negative nancy about it, I just don't see the fundamentals really driving this trade.
here is your 1 year total transaction chart per blockchain.info
https://blockchain.info/charts/n-tr...ageString=1&show_header=true&scale=0&address=
Its pretty flat.
http://dealbook.nytimes.com/2014/08...op-than-potential/?_php=true&_type=blogs&_r=0
and this is also interesting.
Margin calls and short selling.
http://blogs.wsj.com/moneybeat/2014...-margin-pains-dishs-bitcoin-option-goes-live/
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amonasro
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When I analyze a chart I look close at 15m then "zoom out" until I look at the daily and weekly. It helps me put together a better picture. I also look at LTC markets as it reacts to BTC markets in fairly predictable ways. So for the next few weeks I agree with you that there should be a technical bounce--the bears only have so much ammo at this point and it's starting to run out; also the drop wasn't precipitated by anything too negative, just uncertainty. No China fud, no bans.
Looking toward the end of the year though, I don't see a big fundamental reason for a drawback to $300 or even $400. We were already there recently after a longer, more painful capitulation and still the buying pressure was immense. As an active member of the community (not really an "insider" though, haha) I can tell you with pretty good certainty there will be many waiting with fiat should we drop to $400 again, including myself.
Technically a weekly view shows that the long-term continuation pattern is still holding and even clinging to the top edge of the pennant, meaning we should still resume Bitcoin's meteoric uptrend at some point. Volume is supposed to trail off during continuation patterns anyway I would say it's bullish. Bitcoin has simply come too far to suddenly bottom out for no reason, or a dubious reason. Governments banning the hell out of it? Maybe. Flaw in the protocol? Definitely. A payment unit of Ebay looking into ways to accept it? Definitely NOT:
http://time.com/money/3116974/uber-airbnb-and-others-may-soon-accept-bitcoin/
As far as margin calls, I would say there has been a bit of margin head hunting going on, meaning traders know that unskilled speculators (ahem, gamblers looking to make a quick buck without a broader understanding of digital currencies) are all leveraged long for a rise to $800 (not a smart move) and those with big coin stashes see the window for accumulation closing and take advantage. The hedge funds/ETFs trying to buy off-market also see this. Bitfinex recently changed there rules so one cannot go past 3:1, I think it is.
For transactions being flat, simply zoom out the chart. Adoption doesn't have to correlate to transaction volume. I also don't see a reason to penalize those who want to use Bitcoin as a store of wealth.
Also, the chief analyst at stockcharts.com, John Murphy, has a book that's honestly better than anything on trading sites today: Technical Analysis of the Financial Markets. Highly recommended... there are so many helpful little things that you don't get from simply reading about indicators from a list.
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newbitech
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I see,
well the link I posted is,
http://stockcharts.com/school/doku....s:john_murphy_s_ten_laws_of_technical_trading
You mentioned "When I analyze a chart I look close at 15m then "zoom out" until I look at the daily and weekly. It helps me put together a better picture."
that contradicts the first law of analysis from John Murphy,
Map the Trends
...Begin a chart analysis with monthly and weekly charts spanning several years...
I mean ultimately the goal is to make profitable trades, so however you come to that conclusion is not really the important thing. Thank you for explaining a bit more about your view on analysis tho. I don't want to come across as argumentative, just want to share my perspective.
Speaking of fundamentals, I think perhaps the only fundamental that would maybe support the massive bubble and parabolic up move was the idea of artificial scarcity being sustainable. Even then, it was more of a projected fundamental and one that I still think is not well understood. So I would agree that it's not going to be a fundamental driver that supplies the selling pressure but rather technical drivers, such as low volume buying vs high volume selling.
On top of that, most if not all of the secondary indicators are extremely positive biased. If the market is a zero sum game, a revert to the mean is definitely in order if not way overdue.
Speculative interests are now being financed by larger money pools as well, so if margin trading is expected to mature, we could reasonably expect volatility to decline with increased liquidity. This I believe with further suppress speculative exuberant tendencies to send the price on wild upswings and devastating collapses that have become a calling card for this trade. There has been quite a bit of technical resistance to the type of correction that I believe this trade will need in order to find stability and finally focus on fundamentals of the underlying asset.
I believe we can read into the long term chart the erosion of those technical resistances since the ATH and that erosion has been gaining momentum.
As far as the demand curve and utilization vs price, I see an underlying fundamental contradiction here that will ultimately need to be balanced out in a technical correction.
On the one hand there is an inverse relationship between volatility and consumer adoption. On the other hand, the volatility fuels the speculative interest that have inflated the trade value.
This is a direct impact on the liquidity of the trade. Obviously, as more adoption occurs the more stable the price will become and the less volatile the trade. Conversely, with a reduction in volatility comes a reduction in speculative interest and a less fluid trade with the mitigating factor being the ability to short trade and trade on margin. This opens up the price to be hammered on a fundamental level as small negative news that send the trade lower triggers shorts to pile up and puts to execute.
The price has been able to hold up against negative fundamentals due to speculative interest and relative higher levels of liquidity that exist in a volatile market.
The technical correction I believe will strike the balance between widespread consumer adoption and liquidity. I believe bitcoin volatility must stabilize at a price level that is less speculative than what we see today in order for widespread adoption to occur. I believe that speculative interests must be converted to investment interest and long term profit expectations must be more closely tied to the actual performance of the underlying asset in the market place, rather than the expectation that the trade with continue to make moon shot after moon shot with no regards to the fundamentals outside of artificial scarcity.
Technically, the trade has been overbought on the longest time scale since large capital started pouring in to it. That needs to and I believe will correct.
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I think Bitfinex is going to implode one of these days. Margin trading BTC just doesn't seem like a good idea.
People think we're turning around now. Some still say no.
This guy says $1400 by the end of the year...
https://www.tradingview.com/v/Ceb7TU6Q/
This guy says $1400 by the end of the year...
https://www.tradingview.com/v/Ceb7TU6Q/
Shane Harris
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The honey badger laughs at your attempts to predict the future.
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