On the hourly analog Bitcoin Bitfinex chart, we have a wonderful bloodbath. The SEC ETF postponement really threw a wrench in the technicals yesterday just as things were beginning to look good for the bulls.
Price was halted twice around the purple 100 hour EMA line when the news dropped and price was crushed, way below the orange 55 EMA and turquoise 21 hour EMA.
The channels of the pitchfork did very little to slow down the drop as price hurtled below the median line between the two green channels in the evening last night and then continued further with a capitulation dump at noon EST today to the low today of $6,128.
There has been a slight recovery over the past few hours here back up to the top of the lower blue channel, but price needs to level off a bit and find some stability while the exponential moving averages catch back up.
I have redrawn the Fibonacci Retracement to the low on June 24th and adjusted for the assumption of a full impulse wave to the high up on July 24th. With this new information included price is now sitting at the blue .786 Fib level at $6,342. This Fib level has been quite popular in 2018 thus far and may prove to be again for the bulls.
There is strong bullish divergence on the hourly RSI, going through the lows on Aug 4th, late yesterday and today’s low. I have highlighted this with the green line on the RSI, so perhaps there is a bit of a relief rally over the next few hours here at least back to the median line of the pitchfork around $6,475.
The momentum on the MACD histogram has been trending upward despite the falling price and it appears like the blue and orange EMAs are attempting to find some support. Volume is looking strong and strengthening on this second drop around noon today, so maybe there is a little more downside momentum for the bears to spit out.
On the daily analog Bitcoin Bitfinex chart, you can see how price did not hold that critical level between $7,100 and $7,000. The retest of the red long-term downtrend line has failed and same with that neck level on the reverse head and shoulder bottom at $6,850.
Price is still contained within that down-trending pitchfork but the increasing volume on each leg down over the past few days is troublesome for the bulls. If this $6,342 level cannot be held for the bulls, it looks like the next stop is around $5,750 to $5,500 near that lime green line and the long term potential falling wedge pattern.
The RSI is now a shade from oversold levels at 31.19 and that strong hidden bearish divergence from a few weeks ago has turned out to be quite prescient and I have marked it again with the pink line on the RSI.
If price can somehow drop to new closing lows here of around $5,850 without giving up much more on the RSI and staying above 26.81, that would be some nice bullish divergence to look forward to. However looking at the current levels, that appears to be asking too much.
The MACD has a large gap between the EMA’s and has a strong probably of snapping back hard, but as of now there is no upward momentum for price on this daily chart. The blue trigger line is also breaking back below the zero bound bearishly, which could be contributing to this sell-off.
The OBV also has reached new lows for 2018 and shows the dying interest in the market, but this could also be a some sort of retail capitulation event where people are giving up on crypto, despite the hope from a few weeks ago, either way I would expect more volatility ahead.
-More on Vanddar.com