Most Popular
1. THE INFLATION MONSTER is Forecasting RECESSION - Nadeem_Walayat
2.Why APPLE Could CRASH the Stock Market! - Nadeem_Walayat
3.The Stocks Stealth BEAR Market - Nadeem_Walayat
4.Inflation, Commodities and Interest Rates : Paradigm Shifts in Macrotrends - Rambus_Chartology
5.Stock Market in the Eye of the Storm, Visualising AI Tech Stocks Buying Levels - Nadeem_Walayat
6.AI Tech Stocks Earnings BloodBath Buying Opportunity - Nadeem_Walayat
7.PPT HALTS STOCK MARKET CRASH ahead of Fed May Interest Rate Hike Meeting - Nadeem_Walayat
8.50 Small Cap Growth Stocks Analysis to CAPITALISE on the Stock Market Inflation -Nadeem_Walayat
10.Apple and Microsoft Nuts Are About to CRACK and Send Stock Market Sharply Lower - Nadeem_Walayat
Last 7 days
UK House Prices - Lets Get Jiggy With UK INTEREST RATES - 28th June 22
This “Bizarre” Chart is Wrecking the Stock Market - 28th June 22
Recession Question Answered - 28th June 22
Technical Analysis: Why You Should Expect a Popularity Surge - 28th June 22
Have US Bonds Bottomed? - 27th June 22
Gold Junior Miners: A Bearish Push Is Coming to Move Them Lower - 27th June 22
Stock Market Watching Out - 27th June 22
The NEXT BIG EMPIRE WILL BE..... CANZUK - 25th June 22
Who (or What) Is Really in Charge of Bitcoin's Price Swings? - 25th June 22
Crude Oil Price Forecast - Trend Breaks Downward – Rejecting The $120 Level - 25th June 22
Everyone and their Grandma is Expecting a Big Stocks Bear Market Rally - 23rd June 22
The Fed’s Hawkish Bite Left Its Mark on the S&P 500 Stocks - 23rd June 22
No Dodging the Stock Market Bullet - 23rd June 22
How To Set Up A Business To Better Manage In The Free Market - 23rd June 22
Why Are Precious Metals Considered A Good Investment? Find Out Here - 23rd June 22
UK House Prices and the Inflation Mega-trend - 22nd June 22
Sportsbook Betting Reviews: How to Choose a Sportsbook- 22nd June 22
Looking to buy Cannabis Stocks? - 22nd June 22
UK House Prices Momentum Forecast - 21st June 22
The Fed is Incompetent - Beware the Dancing Market Puppet - 21st June 22
US Economy Headed for a Hard Landing - 21st June 22
How to Invest in EU - New Opportunities Uncovered - 21st June 22
How To Protect Your Assets During Inflation - 21st June 22
AI Tech Stocks Current State, Is AMAZON a Dying Tech Giant? - 20th June 22
Gold/Gold miners fundamental checkup - 20th June 22
Personal Finance Tips: How To Get Out Of A Tough Financial Situation - 20th June 22
UK House Prices Relative to GDP Growth - 19th June 22
Will Global Markets Be Pushed Deeper Into Crisis Event By The US Fed? - 19th June 22
Useful Things You Need To Know About Tweezer Top Candlestick Pattern - 19th June 22

Market Oracle FREE Newsletter

How to Protect your Wealth by Investing in AI Tech Stocks

Bitcoin Price Depreciation or Reversal – Which Will Prevail?

Currencies / Bitcoin Jun 13, 2014 - 08:39 PM GMT

By: Mike_McAra


In short: no positions are suggested for the short-term.

SwiftBoatVet, a Reddit user, posted a couple screens they got while filling out a survey for PayPal. It seems that the survey itself was revolving around Bitcoin, asking for direct comparisons of the two payment systems. While this fits in quite well with the comments made recently by eBay’s (owner of PayPal) CEO, John Donahoe, who expressed the opinion PayPal could integrate Bitcoin, the survey itself turned out to be somewhat unclear since it treated Bitcoin more as a PayPal clone than a currency or payment system.

The shortest explanation is that, perhaps, the survey was prepared without enough familiarity with Bitcoin and under the assumption that it was a payment system similar to PayPal. While this might have caused a few laughs here and there, particularly on the part of Bitcoin users who made fun of the schematic questions, it shows that PayPal is actually doing something to research cryptocurrencies.

The company most probably researches dozens of possible payment solutions but combine that with the words of Donahoe and you might come to the conclusion that the integration with PayPal is already worked on.

For now, let’s turn to the charts.

Yesterday was definitely one of the most important days following the recent rally on BitStamp. Bitcoin declined heavily on strong volume, losing 8.3%. Yesterday, we wrote:

It seems that Bitcoin will either fall further down, to $600, or trade sideways for some time before going up more decisively.

As it turns out, the first option materialized and Bitcoin actually closed below $600 (solid green line on the chart). This might have looked like a major breakdown but today’s action doesn’t confirm this point of view.

Today’s different as Bitcoin has gone up and recuperated part of yesterday’s losses (this is written around 9:45 a.m. EDT). The volume is lower than yesterday, though. Bitcoin is again above $600.

Based on the above our best bet at this moment is that Bitcoin will go up in the near future. If there’s anything worrying, it’s the fact that we’re still below the recent highs. We consider two scenarios: Bitcoin going up from here, perhaps following a few days of not much action, or Bitcoin dropping further to around $500, than rebounding.

The current situation seems to be providing a buying opportunity but the fact that today might be just a pause within a move down, makes us look a lot more cautious at possible short-term positions.

Now, let’s take a look at the long-term BTC-e chart.

The break below $600 was visible on the long-term chart and the exchange rate is still below this level (but only barely) at the moment of writing. The move down still hasn’t been denied. If Bitcoin declines more, it might stop at $500.

It is also possible that the currency will come back above $600 and trade sideways for a couple of days. We would be inclined to opt for the second possibility but the fact that a move back to $500 is not at all improbable at this time doesn’t suggest opening long positions is a good idea.

Yesterday we wrote:

Based on what we’ve seen on BitStamp and BTC-e, it seems to us that there still might be depreciation or a period of sideway moves ahead. The outlook, however, is still more bullish than not. If we see a strong move up, this could mark a beginning of another serious part of the rally.

It seems like we still can see some depreciation even though the short-term outlook is more bullish than not in our opinion.

Summing up, in our opinion no short-term positions should be kept in the Bitcoin market now.

Trading position (short-term, our opinion): no positions.


Mike McAra
Bitcoin Trading Strategist
Bitcoin Trading Alerts at


All essays, research and information found above represent analyses and opinions of Mike McAra and Sunshine Profits' associates only. As such, it may prove wrong and be a subject to change without notice. Opinions and analyses were based on data available to authors of respective essays at the time of writing. Although the information provided above is based on careful research and sources that are believed to be accurate, Mike McAra and his associates do not guarantee the accuracy or thoroughness of the data or information reported. The opinions published above are neither an offer nor a recommendation to purchase or sell any securities. Mr. McAra is not a Registered Securities Advisor. By reading Mike McAra’s reports you fully agree that he will not be held responsible or liable for any decisions you make regarding any information provided in these reports. Investing, trading and speculation in any financial markets may involve high risk of loss. Mike McAra, Sunshine Profits' employees and affiliates as well as members of their families may have a short or long position in any securities, including those mentioned in any of the reports or essays, and may make additional purchases and/or sales of those securities without notice.

© 2005-2019 - The Market Oracle is a FREE Daily Financial Markets Analysis & Forecasting online publication.

Post Comment

Only logged in users are allowed to post comments. Register/ Log in