Short Term Update: hourly chart @bitstamp

chartNot much is happening these days, BTC/USD is spending time above $840 and volatility is dropping (not necessarily a bad sign). I have shown in the graph two trading opportunities, one for a short selling (for who trades at bitfinex) and a buy signal. If the price movement is at least $20-$30 it’s possible to have a decent profit, fee included.

It is true that looking a four hours chart the price is declining with a series of lower Highs and Lows, therefore i should conclude that from now on it has to fall more and establish a new lower low under $542, logic conclusion. Well when it is too obvious in speculation there is always a surprise around the corner; it might drop a bit from here but i think that it’ll stay above my important level of $650.

I’ve added a moving average to the fast RSI i use, it helps in filtering out bad trade signals.

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18 thoughts on “Short Term Update: hourly chart @bitstamp

  1. Jaco van der Weerd

    Enky,

    I am a bit confused by your message. Do you expect a drop resulting in a new low, below $542 ? Or do you expect a drop that will stay above $650 ?

    Regards, Jacco

  2. alphadragon

    Hi Enky,

    The volatility is dropping, and we are trading within a range. There is support at the bitstamp $830 line over the last few days. With a lower high, and a tighter bollinger band, do you not think there will be a breakout to the upside?

    1. Fabrizio

      I think tomorrow bitcoin Will break up the 950 on bitstamp. If it doesnt ill Never Wright anything on your blog anytime again enky.
      Tx for the good job.

      That was fabrizio 🙂

    2. Jukka Santala

      MtGox just hit 838, lowest in about a week. I see Bitstamp had some sell-offs too, but nothing close to the MtGox drop. Theoretically next downswing will bring MtGox to the 800 range, bringing pressure for Bitstamp to fall near 750, but I’m just guessing 🙂

      I don’t see market depth that far on Bitcoinwisdom graphs, a lot will depend on how China reacts I think, they are at lowest point since the big drop, but haven’t really shown any reaction to MtGox yet.

      1. Jukka Santala

        Given that China continues on level trend, guess I’ll revise my estimate for MtGox closer to 825 – although most support is at 800 now. Bitstamp currently averages around 25 dollars below MtGox, not 50 like I guess on bullish market, suggesting around 800 dollars over there, which doesn’t seem to have much support. Still plenty below 830 dollars, and that’s just the next downswing within hours – for a few hours now they’ve barely moved, though.
        I’m probably still off by a few magnitudes at least, so I won’t be doing hourly updates 🙂 Certainly the market could turn around, but with Mt.Gox RSI failing to make its last overbought position before the dip to 838 dollars I think the market is still plenty bearish.

      2. Jukka Santala

        Yeah, off by a BIT… Sudden impulses are hard to predict. I blinked and seem to have missed it, but seems while BTC China finally started to drop, as if to prove me wrong someone hit Mt.Gox with 500 BTC buy-order bringing the price to 895 dollars in an instant. Usually it seems those kinds of single impulses see market returning to nearly old level within minutes, but this time the market not only remained near the new level, but all markets rising at respectable rate. Bit of a surprise, even though price was below daily average, from under -1 to near +2 standard deviation instanly didn’t seem in the cards.
        Will it turn at 895? Bitstamp back to more like 50 dollars below MtGox (well catching up as I write this) so it’s seen less gain, and will likely show less loss when it turns again. So I guess 800 may not threatened for a while, but I’ll stop short of saying so or I’ll have to correct again 🙂

  3. Andrea Chiavazza

    Quite a spike going on right now! Has anybody seen any good news to back it? It seems to be a bit too sharp to be just an upward correction. It’s hard for me to say on which exchange it originated. Btcchina went quite parabolic, but it also happened on low volumes which is unusual. That would suggest offers being removed rather than bids being taken, am I right?
    Fabrizio looking at your last post, were you aware of anything coming ??

    1. Jukka Santala

      As was discussed above, I’m almost positive it was 500 BTC buy on MtGox that started it, bringing price from 854 to 895. Hard to say for sure, there are certainly trade-bots mirroring price movements between BTC China and MtGox, so BTC China responded instantly and carried momentum from then on.
      MtGox seems to have stopped at 895, as I thought a lot of people were probably expecting/hoping another 895 dollar purchase, it’s also near 2nd standard deviation for daily.
      I’m not convinced RSI oversold explains it, there’s much I need to learn about RSI, I understand you have to look at different step charts, but it’s not until about 6 hour chart that a significant oversold position emerges: http://bitcoincharts.com/charts/bitstampUSD#rg10zig2-hourztgSzbgBzm1g10zm2g25zi1gMACDzi2gRSIzi3gStochRSIzi4gNVIzv (This is NOT the same RSI calculation used by Enky and can give wrong results, but only one I can link to right now).
      The failure to reach overbought position between the two oversolds should be a bearish singnal, I believe. I think it must have been expectation of another 895 dollar purchase (resistance now at 900) on MtGox and oversold position just below -1 monthly & daily standard deviation on BTC China that started it. But it’s certainly leveled off for now, so not a huge spike.

    2. Jukka Santala

      Actually I’ll concede the plain RSI indicator shows rare oversold position before for both MtGox and Bitstamp, but the StochRSI is closer to the setup in SierraCharts. StochRSI and Sierracharts DO show oversold position, but nothing unusual to suggest more than average oscillation.
      In fact it looks like more than one oversold position in line has pretty much always predicted a lower high on current trend, not a higher high. And yeah I’m pissed ’cause I sold on the second oversold position because of that and the general trend 🙂 But I think it was basically just the 500 BTC purchase that changed the game, and could not be effectively foreseen.
      I do wonder why people use market price orders for such big trades though. Is it just a failure to grasp that at least on weekend the market can’t bear such large trades at once, leading to likely loss? One might speculate the price will shoot up on Monday, but a fixed price purchase seems like it would still have been eaten up at much lower price than they paid now. (At least 500 * 40/2 = 10.000 dollars, probably more). Or quick profit if they can sell it back one BTC at a time at 895 dollars, but seems too risky.

      1. Jukka Santala

        Just to correct myself, sold AFTER the second oversold, naturally I don’t sell on the oversold. So looked to sell on the first indication of overbought after the double oversold. It now seems to have a habit of making 5 oversold in a line, or at least a lower high.
        Hard to tell oversold now, I guess it’s very bullish market after the 500 BTC buy, the 875 was probably oversold. But I think it has a good chance of rebounding far down once the market figures there aren’t more large purchases coming (unless, of course, one does come).

      2. Andrea Chiavazza

        One reason why somebody might want to buy 500BTC in such a rush could be because he/she is aware of an imminent very good news for bitcoin that will be announced on Monday. =)
        I’m sure that not all members of company boards behave in a 100% ethical way. Don’t you think?

      3. Jukka Santala

        Interesting theory, though 500 BTC is fairly small peas in that. True though BTC would make insider-trading all too easy, even if it’s not fully anonymous. On the other hand as I said just putting up 500 BTC at 800 dollars or so would’ve saved them a lot.
        Right now it’s looking almost more like market manipulation, with quick 200 BTC purchases any time the price is in danger of falling, on Sierra Chart 15mins steering it off the lower Bollinger band and to the upper band after the squeeze, although I suppose they also MIGHT look like good entry-points into the rise.

  4. Krolls

    Enky, what vwap setting are you using here. It’s clearly not the monthly one is it. I’m trying to replicate this on mtgox chart. Big thanks

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