Bitcoin: USD/BTC (BTC=X) incredibly unpredictable
Bitcoin and cryptocurrency markets are highly volatile and, according to new research, incredibly unpredictable, appearing to move independently of most traditional or expected indicators.
The bitcoin price, which has doubled so far this year after recording heavy losses throughout 2018, is hovering around $8,000 per bitcoin. Most other major cryptocurrencies, including ethereum, bitcoin cash, litecoin, and Ripple’s XRP, have also made significant gains in recent months.
Now, it’s been revealed that bitcoin and cryptocurrency markets do not respond to any of the things that usually move traditional currencies, stocks and shares, or commodities, data provider Indexica has found.
Stocks, traditional currencies, and commodities generally move on company announcements, government policy, and technological developments, while bitcoin and cryptocurrency prices do not, according to Indexica.
It’s been suggested that the bitcoin and cryptocurrency market’s relatively young age could be behind the difficulties in pinpointing what’s caused market moves.
“As we’re dealing with an emerging asset class, crypto evaluation metrics are still largely being developed,” said Mati Greenspan, senior market analyst at brokerage eToro. “Stocks, bonds, currencies, and commodities all have decades if not centuries of price discovery, so analysts more or less know what to expect.
“The crypto market has only begun to mature in the last two years, so we don’t have any of that. What does work well for crypto analysts are simple technical analysis tools like support and resistance points, especially psychological barriers, as well as sentiment, trend, and above all momentum indicators.”
“Bitcoin and crypto prices are all about excitement or lack of,” said Glen Goodman, a veteran trader and author of investment advice book, The Crypto Trader. “Nobody really knows for sure whether or not bitcoin will become a major store of value like gold or even a new global reserve currency like the dollar. So any news short of an outright global ban of bitcoin tends to have little lasting impact on bitcoin’s price.
“For example, China banned initial coin offerings and bitcoin exchanges in September 2017, which was a huge blow as China was the epicenter of crypto development. Yet within a few weeks, bitcoin’s price reached another all-time high!”
Volatility has, meanwhile, returned to the bitcoin market recently, with the bitcoin price recording daily moves that appear to mimic moves last seen at the end of 2018. The daily price change for the month of May averages 4.7%, compared with 3.5% in April and 1.1% in March, according to data compiled by Bloomberg.
Overall, the bias in prices is: Upwards.
Note: this chart shows extraordinary price action to the upside.
The projected upper bound is: 9,126.71.
The projected lower bound is: 7,381.47.
The projected closing price is: 8,254.09.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 5 white candles and 5 black candles. During the past 50 bars, there have been 31 white candles and 19 black candles for a net of 12 white candles.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 86.0626. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a buy 7 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 57.34. 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 15 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 51. This is not a topping or bottoming area. The last signal was a buy 7 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 15 period(s) ago.
Rex Takasugi – TD Profile
FOREX BTC= closed down -59.250 at 8,200.000. Volume was 81% below average (consolidating) and Bollinger Bands were 5% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bullish
Moving Averages: 10-period 50-period 200-period
Close: 7,931.98 7,260.14 4,802.76
Volatility: 31 75 70
Volume: 74,551 83,411 78,686
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.
FOREX BTC= is currently 70.7% above its 200-period moving average and is in an downward trend. Volatility is low as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of BTC= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bearish on BTC= and have had this outlook for the last 7 periods.