Caveat Emptor – this post is wild bitcoin price speculation. But we created this blog to help us clarify our thinking. So welcome to our messy minds.
As you can see Bitcoin (BTC) is currently bumping on the bottom resistance line of the cloud and having a hard time punching through with conviction. And it is never a good thing to have several goes at it and not succeed.
Should it fail. Where are we going?
The bitcoin daily 180MA or 200MA are the next level of support. We’ve mapped both here because some crypto traders like to use the 180MA instead of the 200MA. There’s only $600USD difference between them. But we believe in being thorough.
After that, there’s little support on the bitcoin weekly cloud until we hit the $3,000USD range (shown in yellow).
But we think there may be support on the daily bitcoin chart right below the 200MA. That support is from the 32 day semi-consolidation period from mid-October to mid-November 2017.
This level is further supported by the NVT ratio for bitcoin during that same time period. This would seem to establish a level of support/resistance as well.
The blue box labeled number 1 shows the same time period, and includes a second test of that level with the support holding up. Note also that the purple box labeled number 2 shows a similar support/resistance shoring up any drop from our current pricing to the 180MA-200MA range.
Again, all of this is pure speculation. And if you have read our approach to trading cryptocurrencies you know we are in this for the long haul. But it is fun to try to model the immediate price ranges anyway. If only to keep ourselves intellectually honest.
The last factor to keep in mind is that all of the new money in the space has fairly weak hands. Even though they have been tested since December, a fall below the much hyped $8,000USD mark could force a panic dump on the market. In which case, as we all know, the market will overreact to the downside more than likely. Where quite a few of us will be buying and hodling all the way back up with our fingers crossed.
UPDATE: FEBRUARY 14, 2018
This post was spot on in predicting the range of support. As you can see, once price broke down below $8k it just kept going down till it hit the support area around $6,000 which we discussed above.