Bitcoin | Page 5 | The Gold Forecast

Price points to enter BTC from the long side in the coming days

Thursday, January 21, 2021 - 06:52 by Joseph M. Wagner II

BTC has been on the decline for the past two weeks after hitting a new record high of $42,700 on the CME’s most active futures on January 8th. Today the selling pressure continued currently trading $1,815 lower at $34,780 nearly a 5% decline for the day.

Today’s drop has the effect of taking prices below the 23% Fibonacci retracement level and out of the symmetrical triangle that had defined the range since the beginning of this year. The break below the bottom of the compression triangle is signaling increased bearish pressure and an end to the historic rally although not necessarily the uptrend itself. The 23% Fibonacci retracement level at $34,970 is still being contended as we speak, it has broken back above this level twice on intraday charts and is at the moment attempting a third breach. Whether or not the 23% retracement holds will determine price action in the very near term. If it fails to close above it then we could see a swift drop to either the 21-day EMA (exponential moving average) or the 50-day SMA (simple moving average).

On a fundamental basis, some potentially bearish news came out of Washington. In a press conference recently did the head of the United States treasury Janet Yellen made statements that foreshadow a potential crackdown on crypto.

The previous chairwoman to the Federal Reserve said on Tuesday "Cryptocurrencies are a particular concern. I think many are used - at least in a transaction sense - mainly for illicit financing.

"And I think we really need to examine ways in which we can curtail their use and make sure that money laundering doesn't occur through those channels."

Yellen's comments reverberated ECB President Christine Lagarde, who expressed concern last week that Bitcoin had been used for some "totally reprehensible money-laundering activity."

So, with recent technical and fundamental bearish developments, we may see a decent entry price in the coming days. A bounce off of the 21-day EMA may provide an entry for aggressive traders. A bounce off of the 50% retracement at approximately $26,300 would be prudent for conservative traders to enter. A break below the 50-day moving average would signal a decline to much lower pricing and the pivot into a bear market scenario.

Proper Action

A bounce off of the 21-day EMA may provide an entry for aggressive traders.

A bounce off of the 50% retracement at approximately $26,300 would be prudent for conservative traders. 

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Previous Reports:

Tuesday, November 17, 2020 - 17:44
Bitcoin has breached a level in which some analysts including myself would act as resistance and a likely point to enter a correction. This price level at approximately $16,300 in the CME’s futures contract was taken out in trading Monday and that opened the door for more parabolic movement to the upside gaining another $800 in today’s trading. As of 3:30 PM, EST is currently at $17,715 for the... Read more
Friday, November 13, 2020 - 19:14
Although some analysts believe that there is a distinct difference between what is fueling this rally compared to previous rallies seen in Bitcoin, I do not see this distinction as different enough to negate BTC from a pullback after such a parabolic rise that we have witnessed recently in Bitcoin and believe it is still susceptible to a correction in the near term. The difference between... Read more
Thursday, November 12, 2020 - 20:09
Today Bitcoin hit its target we were calling last week on the nose. While it is true that we recommended pulling profits last week in an abundance of caution after a variant of a candlestick pattern formed “three river evening star” on a daily chart after coming within $150 of our target for this leg of the rally. That target was $16,309, the 71.8% Fibonacci retracement level coming from a data... Read more