Bitcoin Trading Update for May 9th, 2019 (BTC/USD)

May 9, 2019 --- Blog

Bitcoin Trading Update for May 9th, 2019 (BTC/USD)

Market Commentary

After seeing what price did following both the Bitfinex/Tether news and the Binance hack a few days ago, the bulls wasted no time in bidding up the bitcoin markets to new local and regional highs above the technically and psychologically significant 6000 $ level with relative ease, and since that time there's been only one brief retracement back below there that was quickly bought up by the bulls. Now price is consolidating in the 6000's $ before another attempt to tackle the 6100 $ level, which if broken will spark another leg higher, likely above [members-only content] $ hence we are [members-only content] given risks of a continuation are quite high. 

12-Hour Chart

We'll take one more look at the 12-hour chart this week where we can see that price has broken out of the ascending channel on the way to the longer-term supply area overhead which is starting to attract some sellers thus keeping price from closing in that region, although there aren't yet enough spot sellers to shift SCMR from [members-only content] and market structure from bullish despite some questionable candle formations over the past few days. Also note that all of the moving averages continue to pick up steam to the upside, multiple levels of dynamic support continue to actively build below the market, and the Ichimoku Cloud is still growing more bullish out in front of the market, all suggesting higher prices over the coming days. 

Moving on to shorter-term momentum and volume, notice that Willy has now joined the Stochastic in officially overbought territory, MACD is showing a fairly nasty bearish divergence, and PPO continues to flash weak sell signals, all pointing to the need for a pullback in the near future, although RSI still has a bit of room to run to the upside so [members-only content] would not surprise us one bit. The volume indications seem to suggest more upside as well considering how strong the A/D line remains, although exchange volumes are still relatively muted and the volume profile setup leaves something to be desired which will come into play at some point soon. 

Weekly Chart

Next we're zooming out to the weekly chart so we can make room for the monthly chart tomorrow, and we can see that the continuation to the upside this week has sparked yet another [members-only content] SCMR signal on a bullish candle formation that is keeping short-term market structure intact, all good signs for the bulls moving forward, as is the fact that new and stronger dynamic support has begun to build around the [members-only content] $ level. Also note that the EMA's are accelerating to the upside, price is getting close to retaking the still rising 100 SMA, the 200 SMA remains in a steady uptrend, and price has yet to be affected by the lower supply area, so the bulls appear to still be in control for the time being. That said, [members-only content] $ will be very tough to get through, at least on the first try, which is why we think a countertrend move lower is still likely at or below that level. 

Regarding longer-term momentum and volume, notice that the Stochastic is now pinned in overbought territory, although Willy and RSI still have room to run higher, MACD continues to hover above its zeroline, and PPO just started flashing neutral signals, all of which [members-only content] over the medium-term. Additionally, the A/D line remains highly encouraging as it continues to steadily rise, although dwindling exchange volumes and a porous volume profile setup could cause the bulls some trouble in the near future. 

Market Summary

From both a price action and technical perspective it is looking more and more like this multi-month move off of the lows in the 3000's $ has more gas in the tank than almost anyone thought possible meaning that a continued rise in shorts could easily drive this market to or above [members-only content] $ in the not too distant future. Granted, we think a legitimate retracement is needed, and likely, before we can get through the heavy resistance in the [members-only content]'s $, hence the adjustments to the MT (A) PT, but it certainly looks like the bulls will be ready and waiting to buy the dip which would set the market up for yet another big leg up. 

 

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