Short Term Update

Here’s a 60 min chart of the last 7 days, after an initial breakout of the short term VWAP notice that it stopped and found perfect resistance at the first positive deviation line of the volume average. Now it is very important to stay above the first negative deviation line at $480; any weakness below this level is a good indication that the selling pressure is increasing with the possible outcome of a new bottom below the previous one did at $440.
For now, watch out the 480$ level.

chart

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35 thoughts on “Short Term Update

  1. h3speros

    I thought that it’s already quite bearish that we have not found solid state above VWAP? There is maybe higher possibility now that we will break $480 than not, wouldn’t you say?

    1. A retracement from +1dev to vwap is probably too little, i prefer to leave room down to the first neg dev line before saying that it is again bearish in the short term.

  2. Elie

    Hey Enky, the 481 level on BTCE was never reached on Bitfinex. I presume that it’s equivalent to the 491 bottom? 🙂 If we go below 491 on Bitfinex then we would be bearish again i guess.right now I am cautiously bullish but will wait for the breakout this time all in fiat before jumping on the train.

  3. Squad69

    Price action above VWAP so i guess we’re going up now, waiting confirmation passing +1dev. Do you agree ?

      1. Elie

        yeh strong battle happening right now. Gonna go in at 510. Hopefully it breaks up else I will be outdoor and ill be screwed Lol

  4. Skuffone

    Great analysis enky, good to have some areas to watch. Personally I’ve accumulated @ 510 on bfx, and kept some powder dry in case of a pull back to 480 where I might risk the rest with a stop bellow recent lows. Good luck all

    1. h3speros

      I bought back in with slight loss at $520, I’ll maybe sell little at $530-550. We have broken that channel and volume seems to be going up so we might have some more soon.

    2. Arthur

      Bought back in at 499 (phew!), however still a loss of my previous trade to compensate. Let’s see if this little rally holds.

      1. Thats the question. I guess it could still go both way’s. I dont know what to do at this moment. I’m 50% fiat. Bought 30% back to have some BTC if the prices whent trough the roof. But so far it wont go past 525 yet.

    3. Elie

      were obviously going to revisit 560. its finally clearer as a path but I am not sure we will get there easily. I am going to rebuy in today at the retracement downwards somewhere between 506-511 and watch it doing its thing. will try selling at 560 or 555 since were still bearish so chances are were going to go back down to the 400s from that top.

  5. Peter

    Something is going on, Bitcoin related websites are seeing a spike in traffic recently and Google trends is suggesting that August has seen a spike in interest. We are up to 200 ATMS now and compared to the first 100 this grew very fast. According to this chart the price is also under valued http://i.imgur.com/cU6q7IT.png

    I expect a rally anytime.

    1. Christian

      I wonder if the old “sell in may and go away, but come back in September” rule will hold.

      1. Arthur

        Haha, yeah, that’s really an old saying. Research has already proven that it doesn’t hold. The full saying is something like this:

        Sell in May and go away,
        But remember to come back in September.

        For bitcoin this year it was kinda true though; end of May it was somewhere around 650 and I don’t see that price level happen end of this month… 🙂

      1. B.Mums

        I still thinks it’s possible that we stay flat as we have. See the bottom in February and see how it recovered, and consolidated for weeks before slowly inching upward and then exploding.

      2. Arthur

        I’m also patiently waiting for another 400 (high 400 that is) for a buy in again. On the other hand, I’m getting a little creeps from that neverending 501.50 – 505.50 today lol! So I’m paying close attention, in case it starts sprinting suddenly.

      3. Arthur

        “give it 1 week. There will be a last dip below 400 before the rally gets triggered.”

        You might be right Elie, after a little rallye to the 520’s we’re seeing the low 500 again on Bitstamp…

  6. Peter

    Here is what I find fascinating all the new participants to Bitcoin will have more reasons to buy. When I came onto the scene in January there was loads of uncertainties. China, Mt.Gox, hardly any billion dollar companies accepting Bitcoin (Notably Overstock), regulatory uncertainty both here in the UK and US. Since January a lot has changed, anyone coming onto the scene now will have A) less barriers to entry B) less uncertainty C) a more positive view of Bitcoin. The next media hysteria is no doubt going to cause a bubble and I think many whales are anticipating this.

    1. Andre

      i think i am with you Peter. I see more reasons for a positive development than negative. plus the fact that the is no bad news (currently). my expectation: increase … Where to ?? 532 ??? No idea but everything is happening slowly nowadays.

  7. B.Mums

    Let’s just say there’s a lot of speculation. Yes, there are a lot of people wanting to get into Bitcoin as the price has lowered, and people seem to be waiting to see if it dips again IMO. On the other hand, the news regarding regulations has been nothing but negative and I feel this is the main reason for the recent bear market.

    So, two things keeping people from buying…bad regulation and hoping the price comes down further due to such news.

    1. Peter

      I don’t think regulation is a problem as most people are perceiving it to be. When I got into Bitcoin the UK was charging 20% vat on just buying Bitcoins alone.. That pretty much killed Bitcoin’s usefulness in the UK. Then out of nowhere they decided to take this off. The US is giving companies some issues with the Bitlicense but even as it is at the moment its liveavble but it will just mean companies need to be like banks and the cost saving attributes of Bitcoin will be hindered so its not a VAT but a compliance cost that will hinder companies and innovation. But I even think this is going to be fine-tuned and become more accommodating for Bitcoin companies, even if there is no drastic change to regulation I don’t think this will be the end of Bitcoin. California’s regulation is much more accommodating and that’s the 12th largest economy in the world. What we are currently seeing is a battle between commerce and banks. Banks are causing the busts which effect commerce and the banks are also taking a cut out of commerce and it’s in the interest of commerce to win the Bitcoin battle. Overall commerce rules, its a bigger market then the banking sector and there is of course a lot of cross over.

      1. Peter

        Very disappointing with Australia. As long as UK and US are charging tax on Bitcoin purchases then all is good for me, I imagine Japan will follow the same route as US and UK. Once these 3 nations arn’t charging tax the rest of the western world will follow. I think its important to see what regulation the EU will decide to put on Bitcoin. Germany has already stated it considers Bitcoin as an alternative form of money so in my view it’s unlikely that they will tax Bitcoin.

  8. George

    I’m still not using any trading SW but do I feel right, are we in “squeeze” zone?
    btw – sierrachart ws mt4 or 5 – what do you traders prefer?
    tnx

  9. An Avid Coiner

    Enky,

    Thanks for your analysis as always. I’m curious to know your thoughts on mining and the effects it will have on price. Let’s take a moment for a critical analysis. Specifically, we continue to see these large jumps in network difficulty, to the end that mining seems “barely profitable” as compared to this time a year ago. For example, a purchase today of what I consider to be “leading edge” mining equipment, the Bitmain Antminer S3, would require at least 5 months of run-time (at today’s difficulty) to have a Return on Investment (ROI) with a reasonable set of assmptions, other than difficulty. But we know today’s difficulty will not hold, and that 5 months would likely be elongated to 8+ months for a ROI. By the time the 8 months has elapsed, technology will not be significantly better, efficiencies will not be better, difficulty will be much higher, and the ROI for new mining equipment purchases would then be well over 12 months. This is remarkably similar to circumstances that led up to Butterfly Labs release of their first-gen ASICs, whereby mining on conventional GPUs had a ROI time-period of 12+ months. Further, I recall seeing a study published on Coindesk’s website, stating that mining costs about $560 per coin, so in order for miners to stay profitable, coins need to sell greater than or equal to $560 on the open market, which isn’t happening.

    How do you see mining having an effect on the XBTUSD spot-price? Will rising difficulty equate to rising exchange rates? Perhaps the miners will withold supply and essentially force the price upward? Or, is XBTUSD about to fall off of a cliff in a major way?

    Thanks in advance.

    1. The effect of mining i think it is already discounted in the price, if it would have been very unprofitable difficulty would have dropped too (miners quitting) and so on…
      Difficulty is rising and always adapts to the price, and because of this i think that the price to mine 1 btc is probably less then 500$ with modern hardware. I’m no more an expert in mining so i can’t answer to your questions with more detail.

      1. Peter

        Yeah, I see it as the generation of new coins from mining is constant at a predictable rate. This pressure has been with Bitcoin right from the beginning. Despite this, the price moves up as a result of exponential growth, the price may have grow more but I don’t think it will cause any more downward pressure than has already been in the past.

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