1/4/2017 The Market View and Trading Outlook
Welcome to a sideways trending market full of uncertainty.
So how does today differ from yesterday? Not that much actually, as I noted in yesterdays analysis I expected a mild sell off to test support in the $14,000 range or my 77 period moving average; this occurred. What does it mean? Are we going up? Are we going down? To be completely honest I’m not totally sure as of yet due to both good and bad news from technical analysis of the charts. So let’s get to it.
On the 12 hour we are trending down according to the MACD histogram, we are a bit on the overbought side, the MACD 0 line is acting as resistance to the upside and volume is somewhat lacking; all bearish indicators. On the positive side we did have a 7 period moving average cross above the 77 period moving average during the nights, price is holding above the longer term moving average, there is very little MACD/Signal line divergence meaning the market is in balance at the moment and a stalemate exists between the bulls and bears. Based simply on the 12 hour time frame I expect a retest of $14,500 but do not expect a massive slide into the $13,000 range. What I would like to see is the MACD histogram run almost to a selling cycle and then change direction to give us a follow on buying period that will bolster confidence in the longer time frames.
On the 6 hour, price has tried and failed to break the longer term moving average and we are about to enter a selling period according to the MACD histogram, which coincides with my thoughts in regards to the 12 hour time frame. If you look back at my previous analysis and examine the 2 hour time frames you will see a good example of price trying to break a longer term moving average. The same is to be expected here, price must go down so as it can build upwards momentum to break through. A 6 hour positive 7 and 21 crossover above the 77 is a big deal as the last time it occurred BTC was $6800 and consequently went to $19,800. This time frame and the averages therein are a powerful indicator of market direction and future price potential. I have included my projected moving averages.
I felt the need to expanding on the power of this average. Take note of the upwards 7/21 cross of the 77 at $6800 and how that was able to carry us over 100 percent from that point to $19,000+ .
The inverse also holds true, take note of the 7 downside cross of the 21 at $18,400 which took us down to $10,700.
The four hour is looking stellar depending upon your take on trading with moving averages and the MACD. Both the 7 and 21 have broken north of the 77 (very bullish). The 77 sits at $14,000 so any downwards movement will have to battle through that support first and will likely only test the waters below that price point before the shorter term averages bring it north again. I have included my projected trend lines which show on more 7/21 downwards cross, a retest of the 77 and then we go north, way north. The last time these two averages broke from below to cross above the 77 price was $7000 and carried on to $19,000 so we are in a very bullish scenario at the moment, with a high likelihood of +$16,000 price action on the horizon after one more retest of the 77. The MACD also has us leaving a selling session and we are oversold on the RSI; both very bullish. Volume is as of yet mehhh.. so that is a detractor. If I WAG it.. (wild ass guess) I’m thinking upside breakout on Jan 8th or 9th; this opinion based on the RSI, MACD, and Moving Averages.. but don’t hold me to it as this is crypto.
2 hour time frame looks good as well in the longer term. The two yellow circles show price attempting to break above the 77 and being rejected twice before finally making it on the 3rd attempt. Expect a similar scenario in the 6 hour time frame above. We are battling a downward 7/21 cross that will serve to mute large gains in the shorter as the 7 will meet resistance to the upside at the 21. During the next buying period expect highs in the $15,200 range before another stumble and retest of the 77. I have included my projected trend lines. The next 7/21 upwards cross will present a solid buying opportunity for short term gains. This should be followed by a similar cross on the 4 hour chart that pulls the 7 and 21 above the 77 on the 6 hour time frame some time later at which point things look very good; not so much for Alts but good for BTC .
Previous Analysis:
https://steemit.com/bitcoin/@pawsdog/1-3-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/1-2-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/1-1-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/12-31-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/12-30-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/12-29-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/12-28-2017-the-market-view-and-trading-outlook
https://steemit.com/bitcoin/@pawsdog/12-24-2017-the-market-view-and-trading-outlook
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Comment by @inthenow. This is a opt-in bot.
What can I say, A tango of moving averages! Also I fill you improve explanatory power of your writing. This analysis can already compete with professionals. I beginning to get attention on moving average crossings. I have also experimented a little with 8, 21, 89 period combination. I think this combination is great because all numbers are in a Fibonacci sequence.
Just continue good work!
I have never tried that combination, but I may just to see on some coins how it works... Thank you for your kind words
Have you have a problem with bandwidth here on Steemit and you can't use the platform?
(sorry for a question of topic.)
Sometimes it act strange.. yes. but I can always get in eventually.
I find out what is about this issue. Bandwidth can drop suddenly because of increase in traffic but this spikes in traffic are commonly very short and in a matter of minutes everything goes back to normal. Not a big deal.
True, well I have noted it as well on occasion.