Bitcoin: USD/BTC (BTC=X) Deepens Under $10,000

Bitcoin: USD/BTC (BTC=X) Deepens Under $10,000

Bitcoin’s three-months of sideways trading may soon end with a notable price drop, as key indicator is reporting strongest bearish bias in nine months.

The leading cryptocurrency’s stellar rally from April’s low of $4,000 ran out of steam at highs above $13,880 at the end of June. Since then, BTC has produced a series of lower highs well above $11,000 and higher lows in $9,000 to $10,000 range.

With a reward halving (supply cut) due next year, many investors are expecting the ongoing consolidation to end with a bullish breakout. The cryptocurrency is also expected to receive a boost from Bakkt’s launch of physically-settled bitcoin futures.

The bearish bias is currently the strongest in nine-months, according to the MACD.

Technical analysts would argue that the MACD is based on moving averages and tends to lag price. While that is true, the indicator has produced reliable trend reversal signals in the past.

For instance, the indicator crossed above zero in February, indicating a bullish reversal and the cryptocurrency broke into a bull market with a high-volume move to $5,000 in the first week of April.

In another example, the MACD crossed below zero and fell to -8.18 in the second week of November 2018, following which prices fell sharply below $5,000.

Also, other indicators are aligning in favor of the bears. Notably, the chaikin money flow index, which incorporates both prices and volumes, is currently seen at 0.08, the lowest level since April 8, meaning the buying pressure at is at the weakest in 5.5 months.

Technical Indicators

Overall, the bias in prices is: Downwards.

Note: this chart shows extraordinary price action to the downside.

By the way, prices are vulnerable to a correction towards 10,215.11.

The projected upper bound is: 10,467.08.

The projected lower bound is: 8,910.11.

The projected closing price is: 9,688.59.

Candlesticks

A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 4 white candles and 6 black candles for a net of 2 black candles. During the past 50 bars, there have been 24 white candles and 26 black candles for a net of 2 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 32.8448. This is not an overbought or oversold reading. The last signal was a buy 13 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 38.88. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a sell 89 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -188.This is an oversold reading. However, a signal isn’t generated until the indicator crosses above -100. The last signal was a buy 4 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 4 period(s) ago.

Rex Takasugi – TD Profile

FOREX BTC= closed down -56.699 at 9,728.400. Volume was 67% below average (consolidating) and Bollinger Bands were 68% narrower than normal.

Open     High      Low     Close     Volume___
9,760.2509,835.8009,564.5309,728.400 28,897
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bullish
Moving Averages: 10-period     50-period     200-period
Close: 10,102.01 10,397.37 8,279.30
Volatility: 25 47 78
Volume: 62,952 79,713 82,898

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX BTC= is currently 17.5% above its 200-period moving average and is in an upward trend. Volatility is extremely low when compared to the average volatility over the last 10 periods. There is a good possibility that there will be an increase in volatility along with sharp price fluctuations in the near future. Our volume indicators reflect moderate flows of volume out of BTC= (mildly bearish). Our trend forecasting oscillators are currently bullish on BTC= and have had this outlook for the last 9 periods.

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