Long Term Update: Long term Buy? not yet

chartThis is a weekly chart (bitstamp data) since August ’13, it is important to analyze the weekly chart and the net volume , weekly charts have much less noise and if you are using the daily and weekly charts for your trading, always look at the weekly first.
Here this chart is telling us that this market is slowing down its fall, the net volume activity peaked during the MtGox crysis and the subsequent bankruptcy in late february. Since then the net volume slowly started to improve and the selling activity was already diminished when this market bottomed out at $340, first divergence to note.

Now with the recent move to $520 the net volume is in positive territory but i think that it is not enough to put an end to a very long price correction of 5-6 months; the risks of a classic pump and dump move is high, because i think that the recent 15% surge in prices has probably been orchestrated by a single big investor.
Before opening a long term trade i’d like to see at least 2 weeks of consecutive positive volume activity and XBT/USD moving above previous top of $548.

Note to readers: As usual I’m open to your comments.

38 thoughts on “Long Term Update: Long term Buy? not yet

  1. lite

    I too have a feeling this might be a pnd. Let’s hope it’s not. I boughtBTC at 470$ and LTC at10.4$.
    Hope Ltc starts to rise soon as well.

  2. Jack

    Hey Enky,

    I have been an investor/speculator in btc for a few years now and recently branched out into different instruments. I noticed the small pop in btc yesterday and started doing some research and found your blog. I really enjoy reading the technical analysis and future predictions, not to mention the wealth of knowledge you have of btc! Keep up the awesome work with your blog man.

  3. Arthur

    “the risks of a classic pump and dump move is high”

    Which is most probably supported by Twitter spammers that tell everybody that eBay/PayPal will implement bitcoin IN JUNE, which is not true as far as I know.

  4. Enky can you tell me where I can get hold of the positive/negative volume chart that you have there? The charts I have access to only show net volume – not clearly displayed like that. Thanks for your brilliant Blog 🙂

    1. Enky

      You can use the “up/down volume ratio” indicator that is similar, i said a while ago that i don’t have the time to give you assistance about the software, contact http://www.sierrachart.com/ for any question about indicators and other stuff as well.

  5. vanen

    i was feeling that it would hit between 520 and 540 soon, with 530 in my mind, guess i was right… now i don’t know if it will keep climbing, what do you guys think? i kinda feel that it’ll drop like really hard one day or another, but that’s only a feeling… this sudden jump looks very sudden for me, i’m not very confident with this bullish period…

    1. B. Mums

      Personally, I’m done trading for a bit and waiting for the long ride up. It’s too unpredictable right now. The only sure thing is it will go up over long term IMO.

    2. Arthur

      I agree with B. Mums here. I’m not done trading though, but I need to ‘see’ a reason why the price might go down $40 or more. As long as the resistance zones are broken relatively easy, and kinda firmly, and the bounces here and there are like $15 or $20 only, I see no reasons to sell for a trade. Like B. Mums, I hold on to a long(er) view on things, and currently my opinion is: underpriced coin, lots of good news recently, bad news for 95+% priced in, it’s about time to catch up for a $3,000 at the end of the year. Not sure if this is the kick off of the bull run, but the first signs look good, I guess.

      1. FJ

        Plese note that I am a totally uneducated mendicant who would not know a RSI if I sat on one, but I have a couple of observations/questions: The price has been pumped up a couple of times now and it stays there- not a lot of sellers eager to get rid of their coins at this level? This is a positive sign? But what about when it goes 700-800-900, I think there was a lot of buying in december when the curve was vertical, then the chinese screwde us a couple of times and a lot of people (not traders) are stuck with coins at this level. Do you think there wil be a lot of non-chinese selling until we reach 1100 from cowards who are happy to break even?

  6. Anathema

    “the risks of a classic pump and dump move is high, because i think that the recent 15% surge in prices has probably been orchestrated by a single big investor.”

    At what point would this risk or your feeling be strong enough to sell a few coins? If this is a pump and dump, there’s opportunity. And “opportunity plus instinct equals profit” as some say ;). Or do you think it’s too risky to sell at all? I would hate to have missed the opportunity if the price would suddenly drop $50 now.

    1. Anathema

      By the way, even if you don’t believe it will drop, i’m curious if you people have placed any open sell orders at all, or are you holding for the long term?

    2. Arthur

      Holding, currently, and no clear view yet where I’m going to sell for a trade. I’m also looking for the $40+ trades, but so far I’ve only been trading in the bearish period Feb-May, with the goal to obtain more coins. Presuming we might enter a bullish period now, I have to find my trading style again…

      1. vanen

        i’m in the exact same position, i enjoyed the ride during feb/may, got max of coin i could get, but if it changes well, i need to find a new trading style too xD and i’m not sure about what to do right now… i’ll remember this period for sure, cloudy times… best thing to do probably, like always : just sit and watch for now.

        but my two cents are : this is not the definitive bullish road. i have a feeling that we will be on the long term bullish very soon, but not yet. this, smells fishy. hope i’m wrong

      2. Arthur

        Well, it’s the right moment for a pump and dump scheme, however, ‘normal’ professional investors will step in at the same moment I’m sure: when the price seems to have reached a ‘stable’ low and the outlook for the future is good. And this investor happen to have millions for investing, thus contributing to the first spikes up.

        I was mostly alarmed by that tweet I mentioned though, and I noticed multiple Twitter users have been sending that exact same message. I consider it spam, most probably trying to contribute to an intended bull run within this possible scheme. It depends a bit what the pump-dumper aims for: 15%? 25% or more? I guess we have to keep an eye out for more of these vague rumors, and meanwhile trying to follow the pump: sell at the right moment for a good trade. Since we both bought in below 450, we have some margin. And if it was a ‘normal’ investor anyway, let’s sit back and enjoy the start of maybe a real bull run, right? As Enky suggests, let’s see what is happening the upcoming two weeks…

      3. Elie

        guys that’s my sole opinion on this, the next cycle or bubble has begun. I am holding now up to $590-600 then selling their (expecting a small drop) then I think we will continue upwards past $600 slowly but surely like the past recoveries (Dec or Feb).
        Traders that have not traded since December because of China are coming in and buying IMO.

      4. vanen

        mmmh, i’ll keep an eye with that thought! market seemed to gain life right now, maybe the first spikes were kinda “faked”, but i sure helped to make it on the bullish road. i think next step will be around 550 , after that i’m not sure about anything anymore, i just don’t see it dropping in the short term unless something bad happens .but i definitively feel that in the mid term a drop is going to happen, not sure how important it will be though, i hope it’s will be what elie is talking about.

        i reaaaaally would like if things turns out like elie predicted, i will maybe make a sell order at ~590 tomorrow later just in case

  7. Arthur

    “…and XBT/USD moving above previous top of $548.” -Enky

    Things go pretty fast, it started nibbling around that level just now, after which it dropped $20 only. We saw the same pattern around 465, 502, and around 517 there was a hickup too. Depending on how fast the 548 and ~600 (presuming somewhere there is a next resistance) are broken, I’m seeing a slope developing that is gaining momentum in a vertical direction. Compare this to the Oct. 31, 2013 – Nov. 18, 2013 period.

    This might mean we might see higher highs before a firm correction will take place. I’m very, very carefully thinking 900’s. The way the next 3-4 resistance lines are broken will proof me wrong, or maybe not… For the moment it’s just a thought that I wanted to share. 🙂

    1. Arthur

      Dropping a bomb on this theory myself, lol. Since the price went from 547 to 515, and bounced up a little from there, we see a full ride between resistance and support (wasn’t 517 the 2-month vwap?) for the first time. Interesting. Will the bulls or the bears win this game?

      1. Elie

        The first resistance and support is 520, and if it breaks significantly this Saturday then we will go to the 2nd resistance which is now around 505-500. I put my rebuys their after selling at 540. In case we don’t get to the 2nd resistance I will rush in and buy on our way up. Remember this is a consolidation phase on which we will stay shortly in order to get the steam for the next leg up so we can break 550 and towards 590-595

      2. Arthur

        “this is a consolidation phase on which we will stay shortly in order to get the steam for the next leg up so we can break 550 and towards 590-595”

        Yeah, I thought so too, but I didn’t expect it to dwell down all the way from the 548 resistance to the 517/520 support… So I didn’t sell. Good you did! 🙂

  8. FJ

    Off topic maybe, but every time I buy something online now I ask the seller whether he will accept Bitcoin. I thing this is a brilliant way to promote it, if youask 10 sellers and so on…I actually found that one of my favourite ancient coin dealers Harlan J. Berk of Chicago accept Bitcoin- would you belive it…:-))

  9. Elie

    guys there is a lot of buying happening right now midnight 05/25/2014 I havent seen so much buying and green candles been a long while. If you are still in fiat I would recommend buying in fully now. The demand is there for bitcoin, were going up past 548 VERY SOON. Might be minutes to hours. Once we pass 548s all bets are on for the new cycle and a big rally! (hope not to jinx it and a bad chinese news comes in 😉 lol)

    1. Elie

      Anyone alive from u guys 😉 looks like i was the only one awake watching the market tonight. 548 broken!!! were at 555! next stop 595. time to also go long too! were officially bullish and back from the dead !

    2. Arthur

      Yeah, I was asleep… However, since the 440’s I was 100% in bitcoin anyway. Now I’m getting curious if I can bring my theory back to life.

      1. Arthur

        No rocket science lol…

        “Depending on how fast the 548 and ~600 (presuming somewhere there is a next resistance) are broken, I’m seeing a slope developing that is gaining momentum in a vertical direction. Compare this to the Oct. 31, 2013 – Nov. 18, 2013 period.”

        I’m trying to predict a next major correction for my trades, which might be in the $900 range.

  10. 30 days swaps are hot as hell and expensive as gold. the bulls just started. it will be a steady long run up to the old high. it seems the old days are back. pump it up. so next stop about 600 and before or after a bear trap reverse. Good luck and good speculations. (Not for daytrading recommended)

    1. Arthur

      Thanks, good info. There is indeed a good possibility that the coin will be looking for new highs, $1,200+. Maybe that correction I’m looking for is at $1,200.

  11. Mike

    I have completed my 2nd of 3 trades to ride this out the bull market. Good luck guys. As always, enjoying Enky’s TA articles.

  12. Skuffone

    Hi Enky, assume you have read this (maybe even wote it!) as you have previously expressed that you had suspicions of insider trading at gox. Does the sheer volume of willy trades surprise you and to what extent does this report change your outlook for bitcoin?

    Looking forward to your insight as always.


    1. Enky

      I haven’t wrote it, btw it is interesting but today it is more difficult (but eventually possible) to orchestrate a strong ride because there are more liquid exchanges then before.

  13. Elie

    lots of demand and green bars tonight again from China’s Bulls we should be waking up tomorrow to 600-700 range

    1. Arthur

      Looking like it’s going to happen today, yeah. It didn’t dwell down to 548 support, and keeps pushing the 590.

  14. Marc

    When I take a look at the past few days, the increases have been very ‘stepwise’ leading me to feel like it’s very very controlled. Pump and dump likely feeling. Any obvious dangers seen by anyone or is this organic?

    1. Arthur

      For the moment I’m thinking it’s organic, however, still keeping an eye on the news if it contains vague rumors that support a pump. But fundamentally bitcoin is very underpriced so a jump up is justified to my opinion.

      1. I agree with Arthur, many new investor were waiting to jump into Bitcoin this is was reflected by Bloomberg tracking its price as they had a lot of requests to track it. These investors were just waiting for bottom to be confirmed,

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