Bitcoin Trading - June 12, 2017 - The Big Pullbackski

ancapwarren (53)in #bitcoin • 9 years ago

Holy cow! Bitcoin was poised to breach $3000 last night when I posted. I woke up today to a $500 price drop! What in the world is going on? Why $2500? Let's see what the chart shows.

If we look left, structure always gives us the rest of the story. In the past, $2500 has been an important price. I've circled all the times the Bitcoin price has visited $2500, it's a decent number of times. It doesn't hurt that $2500 is a psychological number as well. It's a nice round number. It's also 1/4 of $10,000. It's easily recognized by our minds. It's also been both resistance and structure in recent weeks.

That still doesn't explain WHY price dropped though. There was no significant volume of money sucked out of the Cryptosphere like there was a couple weeks ago, so maybe traders just wanted to take some profit. I guess it could also have something to do with the recent Ethereum pump. People have been buying Ethereum to get in on all these ICOs, so maybe that's where the money went. Bancor only raised $153 Million though, so that doesn't explain all of it.

I measured this whole move from the last sell off to the peak with the Fibonacci Retracement Tool and this is only a 0.5 retracement, so that's normal market activity. I'm going to lean toward traders taking profits. Maybe they've gotten FOMO for Ethereum, who knows?

No matter the cause, Bitcoin is oversold right now, looking at the RSI and MACD. I'm expecting it to start rising again and continue it's trend up. We've got nothing but upside from here and hey, a $2500 Bitcoin is nothing to sneeze at! Remember, just a month or so ago, we were still in the $1000s!

If you took the advice I give every day at the end of my posts, you'd have sold near the top and be increasing your Bitcoin stash right now buying this dip! I'll leave you with that same advice today. Keep your stops tight and trade safely.

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