ON suggestion of JP in comments I’ve decided to look at some of my favorite indicators, although I initially inserted it into end of last post I’ve decided to give it a post of its own instead.
Heres a look at btc-e with some of my favourite indicators added, chart shows candles of 1 week so its quite a long timescale I’m looking at.
Starting with Momentum, as the bitcoin price has made a series of new lower lows on its way down, pink dashed line. On Momentum indicator the lows are higher. This is bullish divergence.
On MACD there is no bullish cross upwards yet, on this timescale, where each candle is a week. However bitcoin looks well oversold.
Stoch RSI already looks to be turning bullish with blue line crossing up above the red.
RSI dipped below 30 into oversold territory which I think is very rare for bitcoin.
In my view all these indicators are saying that bitcoin is oversold. This doesn’t mean there can’t be a final push lower, but it might be risky waiting for sub 100 bitcoin though 😉
edit: I’ve just noticed these charts are saying Bitstamp, bit confusing, I thought I’d switched to BTC-E!