In this week’s bitcoin market price trading analysis, the focus is on the last 72-hrs. There has seen a large sell-off in Bitcoin.
The price hit a low of ZAR 8,575 after essentially trading sideways for most of the last week of July.
Most of the Bitcoin press is attributing the rapid decline to a ‘secret meeting’ between leading mining firms and developers of Bitcoin Core.
In reality these sort of sell-offs happen in Bitcoin from time-to-time. It is always pure speculation when attributing them to a single event.
However, this price action certainly did catch a lot of traders off-guard.
The long-term bull-patterns in the market are well established. A charge on to new all time highs can never happen in a straight line. After sideways trading for a while, most were expecting a break-out to the upside. Markets are rarely if ever rational.
Bitcoin Market Price Trading as Reaction to Hard Fork?
Talk of a Bitcoin Hard Fork has resurfaced. This is following an extended period where scaling concerns seemed to have faded into the background.
This comes at the same time as Ethereum’s highly publicised hard fork and the unexpected outfall from that.
Right now Ethereum exists as 2 viable chains with significant market cap and hashing power. Few were expecting that.
So Hard Fork, just as a term, is very contentious. Any talk such talk is likely to make markets nervous.
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The scaling roadmap for bitcoin involves implementation of segwit, improvements to the relay network, some other minor changes, then a hard fork sometime in the next 2 years.
With a Hard Fork on Bitcoin’s medium term horizon, markets will likely be nervous and unstable for a while. How the hard fork plays out in Ethereum will likely impact people’s perceptions of hard forks generally. This will have a flow affect to Bitcoin.
Bitcoin Market Price Trading and Forecast
If the downward trend continues, the next level to retest is ZAR 8,200 – ZAR 7,800 . From there we can expect to find significant and strong price support.
In the short term our charting indicates that traders should expect the down trend to continue.
Our patterns indicate a larger consolidation that could see the price heading to lows below USD 500 in the coming months.