Bitcoins mauled by the chinese bear

All the interesting news is coming from China, many thanks for all comments in last thread. It seems the chinese authorities are deciding to declare war on bitcoins. Chinese exchanges will not be allowed to accept deposits anymore however bitcoin investors will be allowed to sell bitcoins and retrieve fiat funds. In other words, if you are chinese you are being told, sell now. I’m not 100% sure if this is all confirmed. But even so a big sell off seems to be in progress.

Based on technicals I was already bearish based on the way the charts have been looking. The strong horizontal resistance has been breached and price fallen around 20% on Mtgox in US$. In China the bear is raging even more, and price down about 28% at time of writing. These prices will seek to balance out, I’m guessing China will pull US$ down further along with it.

Heres an update to the China bear fork I posted a little while ago.

And for good measure heres the updated MtGox bear fork I have also recently posted.

Based on these charts I’m guessing China may not fall much further but further falls in US$ might be a bit more likely. My analysis may well be revised a fair bit as things continue to develop.

I’ll be away from home over the festive period but will try and post as normal, particularly if anything exciting happens.

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6 thoughts on “Bitcoins mauled by the chinese bear

  1. For the last crash (April 2013) you called the bottom to be $50 and you were spot on. That was an over 80% drop from the peak at $260. Since the peak this time was $1200, if that same drop occurs, that’s a bottom in the $200-$300 price range. Would you agree that will be the bottom this time around?

    • That sounds possible but bitcoins surprised me by recovering quicker than I thought in April. Did it reach $50? If so it must have been a very brief spike.

      I note theres a strong rebound at the moment but finding it hard to update my charts just now. Internet access is a bit of a problem just now, so I may not be able to update my blog as easily as I thought

      Will try and assess the charts later. I have a feeling the drop and the rebound are well within the last bear fork I last posted

  2. Managed to update the MtGox fork just now, so heres an update to that. https://www.tradingview.com/x/xWTXsXJ1/

    The price has more or less stayed in the top half of the fork but is facing a battle against horizontal resistance which was previously strong support. Wouldn surprise me to see price consolidate around the $700 level for a little while before the bear resumes… we will see

  3. Given the Chinese govt has allowed withdrawal to continue till the Chinese new year we might not see a second dip till then as people have their last chance to cash out. The most recent drop was likely some panic and also some early cash outs or sell /rebuy plays based on the news. I wouldn’t be surprised if things plateau for a bit and then start to take a bit of a dip around January.

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