Bitcoin Price Analysis
I won’t waste anytime with conjecture! Let’s get to it.
So, as I mentioned numerous times in my last Bitcoin price analysis (I put this up yesterday):
$6.8k is the battle zone that everyone needs to seriously watch out for.
Above is a live picture (at the time of writing) of where the price is now in relation to that downtrend resistance.
It’s pretty much right up against it and its in that same exact zone of $6.8k that we mentioned before.
So What Now?
For me, the most important thing to do would be to measure the actual momentum of Bitcoin’s price movement to get a better idea of whether it’s going to actually break through this resistance point or simply get rejected again.
Relative Strength Index
Even though it looks good you actually need to be wary here:
As you can see in the above chart, RSI is racing past the ‘50’ value. Currently, it is at 57 on my chart.
For RSI, if it is coming from an oversold value, and it passes 50, that is conventionally seen as a ‘buy signal’.
This rule really only has some specific meaning if we are in a bull run.
Check this out:
We’re in an undeniable bear market (i.e., downtrend) at this point. So, the higher that the RSI gets (on the daily), the more cautious we should get.
Now, we aren’t quite near the value of oversold yet, but its creeping there. And this is looking like a point where the RSI can get throttled back.
Let’s see how it’s reacted in the past on the daily when its been up this high in recent times.
I’m sure most people remember April 2018. It was a great month for crypto. It was an especially great month considering how abysmal March went.
Curiously, it was also a month in which the long-term downtrend appeared to have been broken.
Let’s do a play by play on what happened there:
We were in a similar situation to where we were at the beginning of July as well.
The downtrend resistance that I plotted above was not from December. It was from March 5th to the point that we’re at now.
Try to focus only on the relevant bits in the picture above. Ignore the price action that followed it (we’ll get to that soon).
Let’s forward to the beginning of July for a second…
This is a chart that I posted on July 4th, 2018:
That was the price breaking past the long-term downtrend resistance from May 5th to now (localized downtrend just like the one broken in April from March 5th).
Now Let’s Go Back to April
After the price broke past that localized downtrend in April, it headed toward the long-term downtrend (at that point) from December.
Check it Out Below:
The golden circle on the chart above represents the point which the price broke the long-term downtrend resistance from December.
This occurred on April 20th.
Then the price hit $10k and turned down.
I Think That We Will See the Same Happen Here
It seems logical. Personally, I think that there is enough momentum to probably push Bitcoin over the $6.8k hump.
But, I don’t think that the rise in price will be anything very substantive.
Who knows, $7k’s seem plausible. Perhaps even the $8k’s.
I firmly believe that the SEC will ultimately decline the ETF proposal. And that will probably be the catalyst that throttles the price down to one of my intermediary long-term targets of $5.5k.
Disclaimer: This is not financial advice and I am not a financial adviser. I was not paid to write this review by any entity either and am not receiving profit for the curation of this article.
The author is entirely divested of all cryptocurrencies at the time of this article’s publication as well.