Steem Price Analysis: Time to buy, or hunker down for a slow decline?

in #steem7 years ago

On the last update we talked about Steem approaching it's 200 day moving average and the significance of that. 

At the time Steem was peaking just above it's 200 day moving average intraday, but closed below that line by the time the candle officially printed. 

At the time it was stated that when a price reaches a significant moving average (like the 200) after trading below it for so long, it is often met with some resistance and a couple day pull back is to be expected. 

Flash forward to today, and we have seen exactly that. 

The price is currently sitting around the $.74 USD mark and has retraced quite a bit off it's recent high. Now the question on everybody's mind...

What does Steem do next?

That is the $64 thousand dollar question!

Luckily for us we can make some educated guesses using some technical analysis. Again, technical analysis is not a crystal ball and it only works slightly more often than it doesn't work. All it gives us is the history of the price and offer some possible support and resistance areas based on it's trading history.

As the saying goes... "price often has memory" and "history tends to repeat itself".

Something like that...

To help us get a clearer picture lets go to the charts.

The first chart I would like to look at is the one I have been talking most about in the last couple days. 

The Daily Chart.

The following is a Daily Chart (where each candle stick represents 1 day's worth of trading activity). It shows the trading in Steem since it's inception just over one year ago:

If you look real close in the far right corner of the chart you can see how the price briefly peaked above that 200 day moving average (pink line) before being slammed back decidedly below it. The price has continued to slowly make it's way downwards ever since. 

As of writing this Steem is currently sitting at $.75 USD.

So far there is nothing in that daily chart that is of great concern. In fact the price has reacted more or less how one would have expected it to. A pull back from the 200MA after making such a ferocious move up to meet it. 

Ideally, we would like to see some form of support here over the next couple days before we would say it is a good spot to buy. There hasn't really been a show of that support just yet, but it is still early in the pull back process. 

The simple fact that the price hasn't completely cratered after such a sharp rise is good news in itself. 

Now, if the price is making just an ordinary pull back before resetting and going higher does that mean this is potentially a buying opportunity?

I can't answer that for everyone, but for me personally I see the possibility of a trade setting up. 

If we zoom in a bit and take a look at this 30 minute chart showing the last week of price action, we start to see the possibility of an entry point. 

The price is hovering near it's lower bollinger band and has retraced about half of it's move up. Which is often a support area. 

For those reasons, and the ones mentioned above, this might turn out to be a loading zone for steem. I am not ready to call it one just yet as there has been no confirmation of the price trying to go higher, but it definitely is on watch as a potential loading zone.

Some other tidbits to keep in mind...

I don't have the data to back this up specifically, but if you go back and look through the last couple months of trading activity, I have noticed that we often make our lows for each week on Thursdays (today). In my opinion, that likely has to do with the a large number of steem being sold (on the open markets) from power downs that take place on that day. 

Again it doesn't always work out like that and I don't have the data to back that up any more than just a simple observation on my part. So, take that for what it's worth or you can totally disregard it. Up to you. :) 

A big part of Steem's move was cryptocurrency wide. Meaning, they all went up together. Steem likely will need some of that to return for the price to go higher at his particular time. I personally don't think the crypto euphoria is over just yet. 

Also, keep in mind that this giant price rise could have caught a lot of people off guard that were locked up in Steem Power and they are just now starting their powerdowns after the big move up. That supply hasn't hit the market yet and could in the next couple of days. Which could throw any TA out the window...

So, be aware of that also if you are going to be doing any buying around these levels. 

In Conclusion:

I tend to think this couple day pullback that we are currently experiencing is healthy and expected. If we are to continue higher, we likely need to hold up in this area over the next several days though. 

My thoughts are that after the couple day pullback is over, Steem will again start a move back up. Potentially breaking it's previous recent highs. 

Disclaimer:

*This is not investment advice or trading advice. These are merely my thoughts and what I am thinking could possibly happen.

*If you are simply a trader, make sure you set a stop loss and follow your specific trading plan.

*I am a long term investor in Steem and would like to see it move higher so I tend to be optimistic in my views. 

Follow me: @jrcornel

Sort:  

What a great analysis on your part and a great observation for the Thursday pull outs. Thanks for sharing all this knowledge with us. The pointers and information are always appreciated. Namaste :)

You got it. Hope it is useful. I am thinking a weekend rally may be in the cards for steem :)

But the real problem is that Poloniex is running this very complex lag scam. They did this with the "dao hacker attack" last summer too, there collusion with others to make millions is clear if you pay attention, I have been banned multiple times for asking questions about these things. They have had this same lag at 5k users, 10k users, 20k, 32k. It's always the same thing, normal people cant get their orders in, can't cancel orders, can't close margins, get charged lending fees with no orders open, pumping coins right before a "coin delisting" announcement and then dropping all of them on poor people trying to make money.... It's complete BS. Sadly, I don't know a better exchange. I truly think Poloniex will end up like Cryptsy.

Yep, I have noticed that too. When poloniex gets on the wrong side of a trade they seem to manipulate their platform to correct it. For example if they are trying to unload something they suddenly seem to have "issues" where their customers are prevented from being able to sell a particular coin... something along those lines. It's definitely shady.

Absolutely..They also put you on the back burner and don't approve withdrawals when people don't have 2FA active. I wish they would just clean their act up and upgrade stuff and not be shady. Greed is sad.

Yes it is... they could probably make more if they did things legit and just captured more of the market. Make their money off of fees as opposed to trading the coins themselves... but I don't know how much they are actually taking in either. :)

I agree entirely! They have so much more volume than every other exchange for the major coins. I would figure they are making much more money off fees then and all the other businesses seem to be profiting enough to stay open.

Yep, go legit, capture most of the market... make even more money. Let the other exchanges be known as the scammy shady ones!

My guess and strictly from gut intuition is that it won't dip down below .64 or so- good time to buy during the lull. Of course just my opinion- everyone should do their own research and follow intuition : )

That is a good guess considering that is right down near where it fell down to when it had that "panic drop" in the midst of the run up. That is where it found support before, that is where it may find it again... good thoughts! :)

@jrcornel Is it time to buy? .. at this price I'd still say yes
imagine this rises to the same price BTC has now and at that time BTC does become 20k each -
it is still low now isn't it? If we believe that this is the moneyyy of the future damn - consider yourself rich haha in the future? I love the thought of it .. well.. BTC was even worth 0 before ..who would have thought it'll be worth this much these days? What if history repeats itself but then - that time with Steem :D haha

I like what you wrote on the disclaimer. Do you follow a special formula to set your stop loss? btw.. it also helps to have a reliable intel about the market

It depends on your time frame. If you are looking long term it's probably a great place to buy. If you are thinking short term you may get a lower price at some point here in next few weeks...

word on that - investing on a long term basis too

That was a total gut analysis off the top of my head without knowing prior support levels- thanks for verifying there's some numbers to support my guess..

I don't remember if it was actually .64, I'd have to check, but it was somewhere around there for sure.

Great advice. If you are in this for more than a quick trade, never buy all at once or sell all at once... You will sleep much better! ;)

Thanks!

Just set it!

and

Forget it!

Wake up one day!

Rinse and Repeat!

:D

Anytime you can take your emotions out of the equation you are much better off!

Very true!

And if you NEVER get into the RED and have ALWAYS been in the GREEN no matter if you missed a MOON ride, it still FEELS GOOD to be able to give any 1/3rd a shot no matter what the price is at the moment.

By the way, as I'm reading these trading comments, if I powerdown to sell, won't it too late to sell and get the value of the Steem where it us at now? I ask because apparently it takes quite a while before getting our steem back from powering down... Thanks a lot for your help. If it is not too late, I wouldn't mind selling some of them right now to catch the wave and use that money to buy more when it drops! :) Namaste :)

If you power down, it will take a week before that steem is available for trade. For that reason it is best to have some liquid steem at all times in case the price runs up when you are not expecting it, you are able to take advantage!

Thanks a bunch! Basically, when powerdown, the trickling of the Steem follows the value of the progression of Steem and doesn't keep the value it had when you powered down. Thanks, namaste :)

Exactly... the powerdown just gives you a number of steem. The value of that steem is whatever the market price is going for at that time. The powerdown itself is not a sell, it is merely making the steem liquid and able to be sold. Does that make sense?

Awesome article. Thanks for the info and keep up the great work. DR

Could that be why my wallet balance has not moved higher even though I have received a few coins for comments???? I am sorry but I am new. Also is Steam it like the markets where the balance does not change on the weekend? I am trying to learn and understand. Thanks liked your story.

Posts pay out after 7 days. So your wallet won't reflect what you have earned for a few days

The estimated account value was updating hourly and regularly until last night It has been stuck

I'm all in on steemit, I just started using steemit and i love it. also the fact that it is decentralized and the community will decide the value of each post make this platform much fairer than youtube. the writing is on the wall for youtube.

Yep I agree. There are some major changes in the works that will really allow Steemit to really compete with YouTube and other social networks. When those changes happen I think the site will really start to take off!

Nice post, upvoted! Thank you. @jrcornel

Thanks for the great post, very informative! Cheerz

Coin Marketplace

STEEM 0.17
TRX 0.15
JST 0.028
BTC 62104.41
ETH 2404.22
USDT 1.00
SBD 2.49