The STEEM-BTC price is heading for mostly uncharted waters, so be ready for potentially large price swings.
Since last week's post, the STEEM-Bitcoin price traded out of the short-term downtrend, then quickly and extraordinarily resumed its long-term upward move.
The previous downtrend line was broken (red line) as volume picked back up, giving us a great indication that market sentiment was positive for STEEM. Momentum continued to turn over to the upside and we saw a huge spike in both volume and price yesterday. The candle for yesterday's move stretches from just under 50K satoshis up to over 97K satoshis, which is about a 95% gain from the low to the high. The price is now trading well above the recent uptrend line (blue) coming off of the 33K low on May 26-27.
Since yesterday's peak, volume has lightened and momentum has slowed a bit. There is a support line right around 80K satoshis (black) and a lower high that was made around 92K satoshis. If this pattern continues - lower highs and repeated tests of the support line (a descending triangle) - we could see the price drop back to lower price support.
The STEEM-Bitcoin price is essentially in uncharted waters right now. There is some minimal historical price data going back to last summer, but we can't really give it too much weight. That being said, the 100K satoshi line does have a small amount of data and it could prove to be a big psychological hurdle - round numbers tend to be that way in markets and trading. There is currently ~550 BTC (~$1.5 million) of sell orders on Poloniex that would need to be overcome in order to push through that price.
If the price were to break through 100K satoshis, it could easily run to ~120K, maybe meeting some selling pressure at 5K or 10K increments along the way.
If the price falls back on a correction, the stronger line of support would be around 75K satoshis, then 65-68K below. A 50% retracement from this most recent move would be around 73-74K.
The STEEM-U.S. Dollar price came off of the $1.00 support line over the last couple of days. It traded through the resistance line once again, traded sideways for a brief moment, then shot like a cannon from ~$1.44 all the way up to ~$2.75, which was about a 91% move. We can also see the large spike in volume over the past 24 hours. The price is around $2.40 at the time of posting.
What can we expect in the near-term?
As mentioned above, we are approaching mostly uncharted waters for STEEM. Last summer's moves were quick and in one direction. There wasn't much time to build up support/resistance lines and the volumes were extremely light compared to now. We also need to remember that there is a lot of new money flooding into cryptocurrencies, so we're in a bull market (or bubble) overall. Whatever you want to call it, the money is coming in, the crtypo "king" is still the most dominant coin and will essentially drive most of the market sentiment, and the ride can get pretty volatile, even if STEEM wasn't reaching fairly new prices.
The upside targets for the STEEM-BTC and STEEM-U.S. Dollar prices are almost literally the sky. The sky is the limit. What we'll likely see if prices continue to rise is some resistance at round numbers, as I stated above. So, look for resistance at prices like 100K or 120K satoshis with the STEEM-BTC price and $3.00, $3.50, or $5.00 with the STEEM-U.S. Dollar price.
On a retracement, I think 75K satoshis could catch the price on any smaller moves, and anywhere between 48K and 68K should catch a stronger dip.
I would be cautious about buying into these markets at some of the current prices. Anything can happen, including another 90%+ run today or tomorrow. If you're looking to buy in now, pick your targets and average in. I wouldn't start above 80K. Depending on conditions at the time, if the price falls to 75K, that might be a good place to start accumulating.
On the other hand, if the price can break through 100K satoshis convincingly, then that might also be a good time to buy and catch the run up to the next high. I would only recommend this for more experienced traders or for those who can afford to lose money.
If you're trading, always remember:
Never invest or trade what you cannot afford to lose and put tight stop-losses in when prices creep lower towards the support lines.
As always, if you have any critiques or comments about my non-professional analysis, please let me know. If you decide to trade this market, good luck to you!
Disclaimer: I am not a professional adviser and this info should not be used for trading. These are only my interpretations and opinions, and while I would be flattered that you think so highly of my fairly basic analysis, it would not be prudent to use this for transacting/trading with real money.
*Charts are from Poloniex and Coinmarketcap.com. Analysis is current as of approximately 1:00pm EST, June 7, 2017.
