Bitcoin Price Report for April 7, 2017
Apr 7, 2017 --- (ARCHIVED) Free Reports
Market Commentary:
As the market continues to try to price in the implications of the ASICBOOST scandal, bullish bias has persisted in the face of strong overhead resistance and near term overbought momentum. This being the case, and given our fundamental commentary yesterday, we will stay focused on the technicals today especially seeing as though there are some very interesting things to discuss. For the time being it appears as though price wants to stay within the [members-only text] range until the shorter term charts get cleaned up a bit, however we must admit that the odds of a breakout above [members-only text] at some point over the weekend continue to increase with each passing hour sans a more legitimate selloff. Pressure seems to be building for something, and for the time being it feels like that something is a [members-only text].
That being said, we are not expecting a move much above the [members-only text] area, at least not over the next few days, given the remaining uncertainty surrounding the bitcoin mining situation. If/when we get more clarity on that then the market could try to test ATH levels, but until then we will be relying on the technicals as a guide for near term price action until further notice (and they are saying that a modicum of caution is still warranted).
4-Hour Chart:
As we head into the weekend with price struggling to get back above the 1200 $ level, we want to zoom in slightly via the 4-hour chart which is actually showing some very interesting signals emerging. First of all, it should come as no surprise that the market is pausing at current levels given we are right at the medium term triangle downtrend line, as well as at the bottom of the main [members-only text] zone, and we are now outside of what remains a very thin volume profile value area. Also note that Willy and the Stochastic are officially overbought, RSI is slightly bearishly divergent, MACD remains anemic, and PPO is already back to painting strong sell signals.
On the other hand, the EMA's are still stacking to the upside and the 50 SMA has crossed above the 200 SMA (golden cross) while said 200 continues to try to reverse back to the upside. Additionally, SCMR is [members-only text] despite recent [members-only text], dynamic support continues to build around [members-only text] and [members-only text], and the Ichimoku Cloud has twisted back to bullish and is expanding quite rapidly. Finally, the A/D line remains in a healthy and steady uptrend that continues to indicate that the bulls are maintaining the upper hand despite being so close to significant resistance.
While we think that the market could continue to tread water between [members-only text] for awhile, we also think that a move a bit higher into the [members-only text] zone is very possible over the course of this weekend. If not, and the market breaks down below near term trendline support around [members-only text], then we should get a shot at one of the [members-only text] zones shown below.
Daily Chart:
Next week we will revisit the 3-day chart, however we want to stick with the daily for today in order to illustrate how critical of a spot we are at from a medium term perspective. Price is now right at the triangle downtrend line, which also coincides with the area within both [members-only text]zones, so we are surprised that price hasn't retraced more than it has off of the 1202 $ local high. Also notice that price is awfully close to moving outside of the volume profile value area on what is now a very overbought Stochastic, both of which are some what worrying signals. Speaking of momentum, RSI and Willy have a bit more room to run and PPO is still flashing buy signals, while all relevant moving averages continue to confirm the overall strength of the market. These mixed signals are not making it easy to get a read on the near term action.
Adding to the confusion is the fact that the Ichimoku Cloud is still bullish but is also contracting, the 200 SMA remains in a steady uptrend, the A/D line continues to flatline, and we have historical dynamic support and resistance building both above and below the market that could keep it range bound between [members-only text] for some time. While we stated yesterday that we are now more positive on the fundamentals from a medium term perspective than we were previously, we still need to wait for the technicals to recharge and sync up before talking about new ATH's.
Market Summary:
Considering where price currently sits and how stretched the technicals are getting, we would be hesitant to take any substantial positions around current levels. Not only that, but risk/reward profiles remain unattractive and uncertainty has not dissipated from the news from earlier in the week. While we are staying neutral and patient on the sidelines for right now, we are leaving open the potential for a [members-only text] play above [members-only text] if it materializes in favorable fashion over the coming days. Have a great weekend!
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Posted ProTrade Ideas:
1a.) **Bitcoin ProTrade - Very Short Term [UPDATED on 4/7/2017]**: We will consider a [members-only text] position in the [members-only text] area with a stop around [members-only text] and a target of [members-only text].
1b.) **Bitcoin ProTrade - Very Short Term [NEW; ISSUED on 4/7/2017]**: We will consider a [members-only text] position on a move to the [members-only text] level with a stop around [members-only text] and a target of [members-only text].
2.) **Bitcoin ProTrade - Short Term [UPDATED on 4/6/2017]**: We will consider a [members-only text] position in the [members-only text] area with a stop around [members-only text] and a target of [members-only text].
3.) **Bitcoin ProTrade - Medium Term [UPDATED on 4/6/2017]**: We will consider a [members-only text] on a move to the [members-only text] area with a stop around [members-only text] and a target of [members-only text].
4.) **Bitcoin ProTrade - Long Term [UPDATED on 4/3/2017]**: We will consider a [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text].
