Bitcoin Price Analysis 11 July 2018
11 July 2018 | Ricki Allardice
 


1 Day Chart

Price action turned to the downside rapidly yesterday, after failing to break through the overhead resistance of $6775. A sharp decline to the monthly support level of around $6300 took place over the space of a few short hours. The current price level is the structural level at which the left shoulder of the inverse head and shoulders pattern formed. Should this level hold then a retest of the overhead resistance at $6775 may be on the cards again in the next few days. Conversely, if support doesn’t hold at current levels, then a retest of the swing low of $5850 may occur again.

Volume is back to the annual lows again.

(Click image to enlarge)image1

4-hour chart

Price action broke to the downside of the lower ascending trendline (yellow dashed line) yesterday right after we published our price analysis. This led to the rapid breakdown in price. Support failed at the monthly structural level but held just below at the weekly level of $6355.

I would expect some sideways consolidation today, with the possibility of a slight rebound to the upside. However, downward momentum may be maintained, and the successive lower support levels may be tested.

If you took our advice yesterday and placed your stop loss below the ascending trendline, then you are out the market now and protected yourself against the bulk of the losses from yesterday. As such, we are waiting for the establishment of some form of trend before taking a position again.

(Click image to enlarge)image2

The concerns that I have had for the past few months have now been met, should we not see a reversal occur at or above $6550, then we could be in for a deep bear market, possibly testing the $4900 level. As it stands currently, price is trading below the 50-week moving average. The next major bearish milestone would be the crossover of the EMA8 and EMA20 with the MA50 on the weekly chart. This has occurred at the end of June. Should the reversal that we are currently seeing on the 4 hour and daily charts not form new highs, then the bears may drive price to $4900.

Follow Sharenet on Facebook and Twitter for daily crypto updates

Should you wish to learn more about technical analysis or investing in cryptocurrencies, check out our various seminars on offer. We cater for all levels.  

banner


Ricki

Ricki Allardice

Ricki specializes in the field of wealth management with a focus on holistic financial planning. He has a keen interest in the investment fields of property, technology, precious metals and cryptocurrencies. Ricki also holds a Masters degree in Science from the University of Stellenbosch.


Important Risk Notice:

Crypto Currencies are not defined as securities in terms of the Financial Markets Act, 2012 (Act No. 19 of 2012). The regulatory standards that apply to the trading of securities, therefore, do not apply to virtual currencies. Because virtual currencies are not regulated, users are not protected and are at the risk of losing money. Transactions are also irreversible. The price of virtual currencies is based on investor sentiment and can rise rapidly, thus attracting investors looking for very high returns from investments. However, the prices of virtual currencies tend to be very volatile and can drop as quickly as they rise. This may encourage speculative behaviour, which in turn spurs more volatility. Financial risks are, therefore, limitless and claims cannot be made for such losses.

Disclaimer:
The information contained in this article is for informational purposes only and must not be regarded as a prospectus for any security, financial product or transaction. It is neither to be construed as financial advice nor to be regarded as a definitive analysis of any financial issue. Investors should consider this research/article as only a single factor in making their investment decision. We recommend you consult a financial planner/advisor to take into account your particular investment objectives, financial situation and individual needs. The views and opinions (where expressed) in this article are those of the author and do not necessarily reflect the official policy or position of Sharenet.

Share This Story

 
 
Market Statistics are calculated by Sharenet and are therefore not the official JSE Market Statistics. The calculation/derivation may include underlying JSE data.
© 2018 SHARENET (PTY) Ltd, Cape Town, South Africa