STEEM price retreats. How now, brown cow?

in beyondbitcoin •  3 years ago

Let's do a quick postmortem on the previous day's analysis:

In terms of conclusions, I had shared the following:

"Bottomline : STEEM/BTC may be stuck in a tight range-bound consolidation in the immediate term rather than heading higher or retracing back to a new low."

"Near term supports are 0.00105 and/or 00103 levels. "

Well, STEEM/BTC in fact performed a retracement back to a low of 0.001041 and is now above 0.00105 mark (at least i got that support relatively correct). So my view on the tight range-bound consolidation did not occur but rather the potential price reversal did eventuate. What led to the pullback? Well, Bitcoin price suffered a significant correction falling from USD $631 down to $598 a few hours back triggering margin longs liquidation. Counter-intuitively however, most alt coins like STEEM and Ethereum also pulled back in fiat terms to greater extent than bitcoin. As such STEEM/BTC headed lower.

Where to from here?

A) Divergence: We currently have a "provisional" bullish divergence (higher lows in price, lower lows in indicators). Provisional because it depends on whether the current 0.00105 support can hold and not let STEEM/BTC set a lower low situation, reversing this bullish divergence.

B) Probability: STEEM/BTC fell through the cloud support. It is also still in the middle of the neutral zone of overbought-oversold signals. Momentum wise, still in the red zone. As such the likelihood of a strong upward price reversal from the earlier bull divergence is not supported by these particular strength indicators for now.

C) Near term support and resistance: we are currently sitting on the 0.00105 support level and this is being tested. If it breaks downwards to test the previous swing low, then the next major support is seen at 0.001010.

Bottomline: Even though there are signs of an emerging bullish divergence indicating a potential for reversal to higher prices, the underlying demand for steem has not exhibited sufficient strength and conviction to carry this through for now. As such, expect prices to consolidate here further, testing the current 0.00105 support, and if broken convincingly, to revisit the next support levels at the 0.0010 area

In terms of disclaimers: these are just my own views and I will not be responsible for any trades that you may end up taking based on them. You are ultimately responsible for all your trading actions.

In terms of disclosures: I currently have a long STEEM/BTC position which i may add to it at the next swing low test if it eventuates, assuming divergence and strength indicators align to infer a strong rebound price action then.

Appreciate any thoughts, comments, upvotes :)

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Thanks for sharing. Happy to upvote. Steemit is still finding it's feet and the Technicals are very hard to read at the moment. Not enough data-points just yet. Following and looking forward to reading more of your posts. Cheers. Stephen

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Thanks for upvoting Stephen. be well and keep posting :)