Bitcoin: USD/BTC (BTC=X) weekly chart is reporting a bullish golden cross
Bitcoin’s longer duration chart is flashing a specific bull market signal for the first time in over three years.
On the weekly chart, the cryptocurrency’s 50-period moving average (MA) has crossed above the 100-period moving average, confirming what is popularly known as a “golden crossover.” The same cross was last observed in May 2016, according to Bitstamp data.
A golden cross occurs when a short-term moving average breaks above a long-term moving average on a specific time frame (daily, weekly, monthly) and is considered an advanced warning of an impending bull run.
MA crossovers are lagging indicators and merely confirm the prevailing trend, however. As such, they have limited predictive powers, as discussed last week.
The outlook as per the weekly chart would turn bullish if and when the four-month falling channel is breached to the higher side. That would imply a continuation of the rally from lows near $4,000 that started in early April.
Overall, the bias in prices is: Downwards.
Note: this chart shows extraordinary price action to the downside.
The projected upper bound is: 8,091.59.
The projected lower bound is: 6,469.42.
The projected closing price is: 7,280.51.
A big black candle occurred. This is bearish, as prices closed significantly lower than they opened. If the candle appears when prices are “high,” it may be the first sign of a top. If it occurs when prices are confronting an overhead resistance area (e.g., a moving average, trendline, or price resistance level), the long black candle adds credibility to the resistance. Similarly, if the candle appears as prices break below a support area, the long black candle confirms the failure of the support area.
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 19 white candles and 31 black candles for a net of 12 black candles.
An engulfing bearish line occurred (where a black candle’s real body completely contains the previous white candle’s real body). The engulfing bearish pattern is bearish during an uptrend. It then signifies that the momentum may be shifting from the bulls to the bears.
If the engulfing bearish pattern occurs during a downtrend (which appears to be the case with FOREX BTC=), it may be a last engulfing bottom which indicates a bullish reversal. The test to see if this is the case is if the next candle closes above the bottom the current (black) candle’s real body.
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 53.2390. This is not an overbought or oversold reading. The last signal was a sell 8 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 39.12. 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 buy 12 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 -4. This is not a topping or bottoming area. The last signal was a buy 13 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 buy 10 period(s) ago.
Rex Takasugi – TD Profile
FOREX BTC= closed down -168.860 at 7,299.450. Volume was 6% above average (neutral) and Bollinger Bands were 53% narrower than normal.
Open High Low Close Volume___
Short Term: Neutral
Intermediate Term: Bearish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 7,384.85 8,251.49 9,383.90
Volatility: 31 64 75
Volume: 98,047 82,192 85,956
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 22.2% below its 200-period moving average and is in an downward trend. Volatility is relatively normal 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 25 periods.
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