12/31/2017 The Market View and Trading Outlook

Yet another evening of uneventful Bitcoin price action has passed. As I have written in other articles we are at a tipping point where price could drop down for one more low before the spring to new highs, or we are slowly making ground upwards and out of this corrective phase.

As noted in yesterday’s analysis, the follow on selling cycle for the 1 day time frame seems to have had less conviction than the one that preceded it. We have yet to cross the MACD 0 line which typically serves as support against further losses and a bounce point toward future gains. We are also very much oversold according to the RSI at a point when the selling period seems to be reversing. All of these are indicators of bullish sentiment. That said we are not out of the woods yet, but we can expect some gains in the next 24-48 hours. Accordingly I will be assuming some very small positions geared towards a bail if things go south (trend trading).

If I apply a Fibonacci retracement to the weekly time frame we are still looking fairly healthy as we are on the verge of completing a routine 50% correction; I think 56% has been the high number thus far.

That said, let’s not go all in yet as we still have a substantial amount of work ahead of us before I can give the all clear to come out of the bomb shelter. On the 12 hour the 7 period moving average crossed below the 77 period moving last night which will now serve as resistance to the upside. We are also below the MACD 0 will will also attempt to stifle gains.

(2 hour) 7 crossed the 21 to the upside-Bullish, Below the MACD 0-Bearish, Divergence to the Upside-Bearish, Volume ehhh at best-Bearish.. Interpretation relative to larger time frames is we will go up but we are going to stumble along the way

(1 hour) Good volume, another 7/21 cross, with divergence to the upside meaning minor pullback or sideways action. 77 will serve as resistance to the lesser moving averages.

(30 min) The rally so far today, good volume, another cross this one being a 21/77 cross to the upside-very Bullish. Upside divergence, oversbought.. expect short term pull back to $13,700 or lower while the larger time frames build bullish momentum.

The next major hurdles will be $14,000, then $14,600, then $15,600 according to the 77 period moving averages from the 2, 4, and 6 hour time frames respectively. With each break through it may gain momentum for future gains, or may meet stiff resistance and plow downwards again. Short term I am feeling bullish with intentions to sell on a reversal. I will feel considerably more bullish when I see the lesser moving averages 21 make positive crosses to the upside of the 77 on the 2,4 hour time frames which always come with good gains.

One thing that I do believe has occurred beneath our noses is that big money has engaged in a strategic campaign to acquire as much BTC as they can within a set price range. The same goes for BCH which was up 8% on BTC early yesterday as big money was acquiring it in the $2200 price range. I can see strong accumulation at the bottom and the price being manipulated back down at key points so as they can purchase more. A good article on this process can be found here:

http://stockcharts.com/school/doku.php?id=chart_school:market_analysis:the_wyckoff_method

http://stockcharts.com/articles/wyckoff/2015/06/accumulation-phase-absorbing-stock-like-a-sponge.html

In summary expect some good short term gains up to the points mentioned above and some good gains if we break these key levels, but we are not out of the woods yet and may see a lower low to act as a spring for future gains and all time highs.

I apologize if this seems thrown together, Steemit is not my full time gig; trading is, but I did want to get it out there.

Previous Analysis:

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

https://steemit.com/bitcoin/@pawsdog/12-19-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/12-17-2017-the-market-view-and-trading-outlook

https://steemit.com/bitcoin/@pawsdog/12-15-2017-the-market-view-and-trading-outlook

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