Bitcoin
Bitcoin Market Technical Analysis: November 27, 2017
The long Thanksgiving weekend had no effect on containing the raging bulls driving the price of Bitcoin. Over the last two days (November 25th and 26th), Bitcoin has once again made new all-time highs.
In our last analysis of Bitcoin dated November 22, 2017, we pointed out that price was hovering near the edge of the uptrend channel at about $8354.46, and would likely retrace into the uptrend-channel zone back to the lower line before resuming the uptrend to new highs.
While price did retrace slightly to about $7770.00, it went nowhere near the lower trend line of the channel before it turned around on November 24th, and once again broke through the upper trend line.
As can be seen in the daily chart below, Bitcoin closed higher for the following two days (25th and 26th), and is setup to close up again today (November 27th).
Chart #1: Bitcoin Daily
Normally, a move of this sort would be a cause for bullish optimism, especially for a Bitcoin market that has been on a non-stop uptrend that doesn’t seem to be deterred by anything.
However, a close analysis of volume patterns may evoke a more cautionary sentiment, at least for the near term.
The daily chart above (Chart #1) shows volume diminishing as price rises for the most recent price upswing.
Chart #2: Bitcoin 5-Minute
Chart #2 shows a 5-minute chart that zooms in to the section where price breaks through the upper line of the uptrend-channel (shaded area).
A close inspection of the volume spikes indicates that some spikes correspond with upward price movements (blue arrows), while others correspond with downward price movements (red arrows).
There is no consistency in one direction or another, indicating uncertainty in the market.
This requires traders to consider the question: Is this a case of demand (bullish buyers) overwhelming supply (sellers), or a case of limit supply resulting from sellers staying home for the holiday?
The latter seems more likely given the patterns exhibited by volume.
What’s more important to consider is the probable outcome if this proposition is true.
Once the market returns to normal non-holiday activity, traders will adjust their positions accordingly, which could result in a significant and unpredictable price movement. Once normalized, the market should exhibit more certainty in its indications of direction.
Technical analysis is based analyzing markets for consistency in price behavior.
When a market experiences an overall change due to significant events, changes in fundamentals, or holidays, technical analysis becomes less reliable.
The savvy trader will wait for markets to normalize before taking action.
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Image courtesy of Shinya Suzuki via Flickr
Bitcoin price dumped hard on Monday, briefly slipping below $41,000, erasing gains recorded in the previous week. The premier cryptocurrency seems to have exhausted its recent rally propelled by industry vulnerabilities. At the time of writing, the world’s largest cryptocurrency was trading slightly lower at $41,385. Bitcoin’s total market cap has dipped by 2% over the past day, while the total volume of BTC tokens traded over the same period climbed by 58%.
Fundamentals
Bitcoin price has been facing retracements and a rollercoaster over the past few days after recently rocketing to a 20-month peak. On-chain data has suggested that many investors used the opportunity to take some profits, leading to a decline in the asset’s price.
Bitcoin’s price slump is mirrored in the wider crypto market, with the global crypto market cap decreasing by 1.85% over the past 24 hours to $1.55 trillion. The total crypto market volume has increased by 32% over the same period. The Crypto Fear and Greed Index has plunged from a level of extreme greed to a greed level of 70, suggesting a decline in risk appetite.
Ethereum, the largest altcoin by market capitalization, is currently trading at $2,167, down almost 3% for the day. Meme coins have been hit hard by the market slump, with Dogecoin and Shiba Inu down by more than 4% over the last day.
Last week on Thursday, cryptocurrency experts took notice of…
Bitcoin price edged lower on Thursday despite optimism in wider markets on the back of the Fed’s interest rate decision. The flagship cryptocurrency has been consolidating above the critical level of $42,000 after briefly topping $44,000, its highest level in 20 months. Bitcoin was trading 0.71% lower at $42,569 at press time. BTC’s total market cap has increased by more than 3% over the last day to $832 billion, while the total volume of the asset traded over the same period jumped by 22%.
Economic Outlook
Bitcoin price has been trading sideways over the past few days, suggesting a pause in its recent rally towards $45,000. The premier cryptocurrency has decreased by 4% in the past week but remains 15.22% higher in the month to date. The digital asset has staged a significant recovery this year after a torrid 2022 in which a string of scandals, including the collapse of FTX, led to a market meltdown, undermining the credibility of the sector.
The crypto market has been buoyed by the Fed’s latest interest rate decision. The US Federal Reserve on Wednesday held its key interest rate unchanged for the third consecutive time, in line with market expectations. With the easing of the inflation rate, members of the Federal Open Market Committee (FOMC) voted to keep the benchmark overnight borrowing rate in a targeted range between 5.25%-5.5%.
Additionally, the central bank indicated that three rate…
Bitcoin price has been hovering above the $43,000 psychological level over the past two days amid anticipation about the potential approval of a spot bitcoin ETF. The flagship cryptocurrency has climbed more than 16% in the past week and nearly 170% in the year to date. Bitcoin’s total market cap has increased by nearly 5% over the past 24 hours to $858.9 billion, while the total volume of the token traded rose by 43%. The Bitcoin price was trading at $43,914 at press time.
Fundamentals
Bitcoin price has posted significant gains over the past few days, climbing to its highest level since April 2022, before the crash of a stablecoin that started a litany of company failures, pummeling crypto prices. The world’s largest cryptocurrency briefly topped the crucial level of $44,000 on Wednesday amid rising momentum despite being massively overbought.
According to analysts, with no spot bitcoin ETF approvals yet and the halving event five to six months away, the market is riding on FOMO. Capital has been flowing in the Bitcoin market amid enthusiasm that the launches of spot ETF will bring in billions of dollars of new investment into the crypto sector.
Investors have already started providing capital as seed money for ETF products. Notably, a recent report by CoinDesk showed that the world’s largest fund manager, BlackRock, received $100,000 in capital from a seed investor for its spot bitcoin exchange-traded fund…
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