On linear charts, while bitcoin still looks to be in a down trend and is well within the red downtrending channel shown below, and price is down 4% as I write, nether-the-less it appears there are some ‘green shoots of recovery’ starting to provide hope that the bull mode may resume.
Heres a look at btc-e on linear (ie normal) price scale,
Here you can clearly see the downtrending channel we are in which is well established for over 6 months as the deflating 2013/14 bubble continues on its merry way downwards.
However there is evidence another bull trend is in play, shown with green lines which might be starting to get a little traction. If we look closer at most recent price action you see the dotted line is providing points of support on higher lows, for now at least.
It appears there might be possibility of a constraining wedge, if the green dotted line fails to provide support I’d be looking for support on the solid line below that. It will be quite interesting if bitcoin instead breaks up out of that wedge, however it won’t be plain sailing to the moon after that if it happens.
Switching to log charts shows another version of the downtrending channel which this time looks tougher to break out from, requiring prices above $366 to get above the upper red trendline.
However again, there are bullish trendlines which may come back into play at some point.
From this view it looks like bitcoin ‘could’ drop to a new lower low for this down trend somewhere about $150, unless support appears before then.
Its a tough task to conclude best course of action from this position, down trend is still in control but its beginning to feel to me like the upside potential is gradually becoming greater than the downside, might be getting close to the point where I start thinking about accumulating a little more bitcoin, for the first time in ages.