Bitcoin Price Report for December 16, 2016
Dec 16, 2016 --- (ARCHIVED) Free Reports
Market Commentary (BTC):
As bitcoin remains in a stagnant period in terms of fundamentals, we turn our full attention to the technicals for clues as to where the market heads next. We remain somewhat uncertain following futures settlements overnight considering we did not see near the magnitude of price moves that we were expecting, in fact most of the volatility came just before OKCoin Quarterlies settlement occurred. This could either be a good thing or a bad thing given where the market currently sits, so we need to check with the charts to make sure nothing has substantially altered the short to medium term outlook.
We begin today's analysis with the 6-hour chart for a look at the near term technical setup. We can see that although the market did not experience much in the way of price movement last night, SCMR continues to paint [members-only text] while dynamic support builds around [members-only text]. Also note that there was a brief breach below the upper trendline yesterday, however ultimately it held as did the bottom of the near term supply area. Additionally, the EMA's are starting to stack to the upside once again, both the 50 and 200 SMA's remain bullish and supportive, and market structure is [members-only text].
As far as momentum and volume go, notice that while RSI is getting close to overbought territory, Willy and the Stochastic still have plenty of room to run, MACD is about to cross the zeroline, and PPO remains neutral. Not only that, but the A/D line continues to [members-only text] at current levels as trading volumes diminish while price pushes to the upside. The one thing that continues to give us pause is a rather unattractive volume profile setup, however there appears to be too much [members-only text] to let the market [members-only text].
With that in mind let's move on to the daily chart in order to put the current action into context as we move into the weekend. We can see that despite now being well within the OTE short zone, as well as the upper portion of the longer term supply area, price is not reacting with selling like we usually see in these circumstances. In fact, SCMR is still painting [members-only text] on [members-only text], while dynamic support continues to build around the [members-only text] and [members-only text] areas. Additionally, the A/D line remains in a steady uptrend, RSI and MACD still have some room to run to the upside, and Willy and the Stochastic are overbought but seem to be confirming strength as opposed to exhaustion.
While there is a part of us that remains cautious on the market at current levels due to a potential bearish rising wedge that continues to materialize, as well as stretched momentum indications on multiple medium and long term charts, we cannot shake the feeling that price action is telling us that the early innings of a supply shock are currently playing out. If this continues, and combines with a continuation of the increase we have seen recently in global demand, then we have the recipe for a major move over the coming weeks, and perhaps months.
On the other hand, a near term correction remains a possibility but we also remain [members-only text]. Either way, we feel comfortable with our ProTrades and positioning going into the weekend trading environment.
Posted ProTrade Ideas:
1a.) **Bitcoin ProTrade - Very Short Term [UPDATED on 12/16/2016]**: (a) 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.) **[UPDATED on 12/14/2016]**: We will consider a [members-only text] position on a move above the [members-only text] area with a stop around [members-only text] and a target of [members-only text].
2a.) **Bitcoin ProTrade - Short Term [UPDATED on 12/15/2016]**: 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].
2b.) **[UPDATED on 12/14/2016]**: 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 [ACTIVE; UPDATED on 12/5/2016]**: We will stay [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text]. We will add to the position on a pullback to the a [members-only text] area.
4.) **Bitcoin ProTrade - Long Term [ACTIVE; UPDATED on 12/5/2016]**: We will stay [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text]. We will add to the position in the [members-only text] area.
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