Well the rally hypothesis of my last post is looking a bit less likely just now, but not to fear this may give a chance to accumulate more bitcoins on the cheap for perhaps the last time in this bearish correction. However despite bitcoin fail to maintain the upwards trend it still hasn’t yet fallen downwards again so far. With price still pressing up against that resistance, if some positive event causes price to pop up through that resistance then the ralley might still be on I suppose. Perhaps a little more likely price will capitulate and fall again, maybe back towards the levels of the last low.
Heres some charts, starting on btc-e linear price scale, 1 month candles..
I see a lot to be bullish about on this long term view of bitcoin. As mentioned in previous post the last low looks to fall on a line also corresponding to other significant low points in the last couple of years, making me speculate this might be the bottom of the huge bubble correction. Marked with purple dashed lines you also see a divergence in price with bearish momentum fading.
There is a possible slightly bullish green channel I’ve marked, I feel next strong bull wave might reach up to roughly top trendline of that near $500 but when? Maybe we need to see some large bottom forming over a few more months..
Heres similar chart but this time using log price scale.
On this chart main thing to note is resistance from the descending price channel which will need to be overcome. Pushing through that will be a strong signal market is turning bullish but we might sill have a wait for that.
Here is an update to a new view that I like very much which is bitcoin priced in gold not $US
As you can see the wedge which I was looking at when predicting my rally has broken downwards instead of upwards. On this chart I am going to pay attention to see if the price looks like is supported by the middle of the channel or if falls back to lower half of channel. Mostly this depends on how far bitcoin falls as despite the price falls in gold bitcoin is much more volitile and affects the ratio the most.
To finish with I might as well throw in my all time log view of bitcoin which shows MtGox datain hollow candles and btce most recently in solid blue and red candles
Here we see the correction of this latest bubble has fallen further than previous bubbles compared to the slope of these trendlines. From this view you may think bitcoin is either priced more cheaply now than after 2011 bubble and after 2013 bubble and therefore fantastiv bargain. Or worryingly bitcoin is entering a death spiral to keep falling and eventually be replaced (by some newer crypto I suppose).
I guess in summary I’m expecting bitcoin to drop (a little) further in the short term and start playing out some kind of bottom formation wether inverse head and shoulders or maybe more likely a double bottom. I don’t think its the end of bitcoin yet based on amount of venture capital investment. But still if you are accumulating bitcoin remember only invest what you are prepared to lose. Don’t overextend. In longer term I think all prices around these levels will be looked at as very low by the time another year or two has elapsed.