Best of the Week
Most Popular
1. Will Gold Price Breakout? 3 Things to Watch… - Jordan_Roy_Byrne
2.China Invades Saudi Oil Realm: PetroDollar Kill - Jim_Willie_CB
3.Bitcoin Price Trend Forecast, Paypal FUD Fake Cryptocurrency Warning - Nadeem_Walayat
4.The Stock Market Trend is Your Friend ’til the Very End - Rambus_Chartology
5.This Isn’t Your Grandfather’s (1960s) Inflation Scare - F_F_Wiley
6.GDX Gold Mining Stocks Fundamentals - Zeal_LLC
7.US Housing Real Estate Market and Banking Pressures Are Building - Chris_Vermeulen
8.Return of Stock Market Volatility Amidst Political Chaos and Uncertain Economy - Buildadv
9.Can Bitcoin Price Rally Continue After Paypal Fake FUD Attack? - Nadeem_Walayat
10.Warning Economic Implosion on the Horizon - Chris_Vermeulen
Last 7 days
Is War "Hell" for the Stock Market? - 19th Apr 18
Palladium Bullion Surges 17% In 9 Days On Russian Supply Concerns - 19th Apr 18
Breadth Study Suggests that Stock Market Bottom is Already In - 19th Apr 18
Allegory Regarding Investment Decisions Made On Basis Of Government’s Income Statement, Balance Sheet - 19th Apr 18
Gold – A Unique Repeat of the 2007 and How to Profit - 19th Apr 18
Abbeydale Park Rise Cherry Tree's in Blossom - Sheffield Street Tree Protests - 19th Apr 18
The Stock Market “Turn of the Month Effect” Exists in 11 of 11 Countries - 18th Apr 18
Winter is Coming - Coming Storms Will Bring Out the Best and Worst in Humanity - 18th Apr 18
What Does it Take to Create Living Wage Jobs? - 18th Apr 18
Gold and Silver Buy Signals - 18th Apr 18
WINTER IS COMING - The Ongoing Fourth Turning Crisis Part2 - 18th Apr 18
A Stock Market Rally on Low Volume is NOT Bearish - 17th Apr 18
Three Gold Charts, One Big Gold Stocks Opportunity - 17th Apr 18
Crude Oil Price As Bullish as it Seems? - 17th Apr 18
A Good Time to Buy Facebook? - 17th Apr 18
THE Financial Crisis Acronym of 2008 is Sounding Another Alarm - 16th Apr 18
Bombs, Missiles and War – What to Expect Next from the Stock Market - 16th Apr 18
Global Debt Bubble Hits New All Time High – One Quadrillion Reasons To Buy Gold - 16th Apr 18
Will Bitcoin Ever Recover? - 16th Apr 18
Stock Market Futures Bounce, But Stopped at Trendline - 16th Apr 18
How To Profit As Oil Prices Explode - 16th Apr 18
Junior Mining Stocks are Close to Breaking Downtrend - 16th Apr 18
Look Inside a Caravan at UK Holiday Park for Summer 2018 - Hoseasons Cayton Bay Sea Side - 16th Apr 18
Stock Market More Weakness? How Much? - 15th Apr 18
Time for the Gold Bulls to Show their Mettle - 15th Apr 18
Trading Markets Amid Sound of Wars - 15th Apr 18
Sugar Commodity Buying Levels Analysis - 14th Apr 18
The Oil Trade May Be Coming Alive - 14th Apr 18
Big Cap US Stocks Fundamentals - 13th Apr 18
Jaguar Land Rover Cuts 1000 Jobs on Diesel Sales Slump, Long-term Discovery Sport Review - 13th Apr 18
Stock Market SPX May Tangle with the 50-day MA - 13th Apr 18
Longtanding Chinese War: Intrigue & Betrayal - 13th Apr 18
How I Own My Gold - 13th Apr 18
ISupply Energy Consumer Warning - Never Put Your Account Into Credit! - 13th Apr 18
SPX Resistance May Prompt A Massive Short Squeeze - 12th Apr 18
Stock Market High Volatility is Not Consistently Bearish for Stocks - 12th Apr 18

Market Oracle FREE Newsletter

Trading Lessons

Bitcoin Important Price Action to Be Seen

Currencies / Bitcoin Mar 07, 2017 - 04:44 PM GMT

By: Mike_McAra

Currencies

In short: no speculative positions.

Bitcoin is making its way into mainstream press. In an article on the CNBC website, we read:

Digital currency advocates had plenty to crow about last week when bitcoin's price overtook gold.

The event signaled a potentially important moment point for bitcoin, which is generally seen as asset that stores wealth. Bitcoin has gained more than 60 percent in price since mid-January.



Now comes a chance for bitcoin to take another step toward legitimacy.

At some point this week, the Securities and Exchange Commission is likely to rule on a request from Tyler and Cameron Winklevoss — the twin brothers who battled Mark Zuckerberg in court shortly after he founded Facebook — to bring a bitcoin exchange-trade fund to market. If the ETF is approved, it will give investors another vehicle to capitalize on the bitcoin craze without having to go to the exchanges where the currency is traded.

While a bitcoin ETF would be huge for the currency, market experts remain skeptical that it will happen.

It is not at all clear that the ETF is the actual reason for the recent Bitcoin rally. It might be the case but it is not a done deal. The more important part here might be that CNBC included Bitcoin in its Coming up this week piece. The general idea here is that Bitcoin coverage might be peaking which would also suggest that the top is near.

Another side of the story is that, if the reason behind the rally is the ETF, we might have quite an important week on our hands. It seems that the market is inclined to believe that the Bitcoin ETF will be approved and hence the move up. At the same time, a report from Needham & Company, an investment bank and asset management firm, puts the odds of the ETF being approved at 25%. If the ETF doesn’t receive approval, we might see a quite significant sell-off. It might also be the case that a lot of the potential upside is already in the price. The balance of odds suggests that we might see if not a move down in the next week, then at least a lot of volatility.

For now, let’s focus on the charts.

Bitcoin moved to an all-time high once again, coming very close to $1,300. In our recent comments, we wrote:

We saw a move above $1,200 but Bitcoin came back below this level almost immediately. On the one hand, Bitcoin is still above the 2013 top which makes the situation more bullish. At the same time, we are already after a very significant move up and the last two days have been a move up on very weak volume so far (...). This is a bearish indication.

The situation remains pretty much the same. We are at an all-time high, however, the recent price action might make Bitcoin look overextended at present and this suggests that at least a short-term correction might be in the cards.

Bitcoin went up but the move was not convincing in terms of volume. The situation is still very similar to what we saw previously. Bitcoin is above recent resistance level, however, the rally already seems stretched and we might be in for a serious correction.

On the long-term BTC-e chart, we see the recent move above $1,200. In our previous alert, we wrote:

Add the move up on average volume and the fact that Bitcoin is getting mentioned by Reuters, and it seems that we might be in for at least a temporary move down. At the same time, we see Bitcoin above the 2013 top a move that seems to be confirmed. This means that Bitcoin might still shoot up before changing tack. This is by no means certain. At present, we would prefer to see some indications of a move to the downside before opening any hypothetical positions.

Right now, we’re seeing yet another move up and it might be the case that this is the possible move up before a more significant correction. We have not yet seen an indication that a move down has started and it would take such an indication for us to consider hypothetical short positions. This is not the case just now. We are of the view that we might be close to a very significant top but we might still see a move up before a corrective move down. The upcoming ETF decision might serve as an important trigger in the next couple of days.

Summing up, in our opinion not having speculative positions might be favorable at the moment.

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

Regards,

Mike McAra

Bitcoin Trading Strategist
Bitcoin Trading Alerts at SunshineProfits.com

Disclaimer

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.

Mike McAra Archive

© 2005-2018 http://www.MarketOracle.co.uk - 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

6 Critical Money Making Rules