BTCUSD Price Update for November 6th, 2018

Market Commentary

Rather than stagnate at 6400 $ for days on end in order to clean up and resync the shorter-term technicals, the bitcoin markets instead probed well below that level multiple times over the past 24 hours which did the job in much quicker fashion. Now price is back above 6400 $ on the way higher with somewhat recharged momentum and favorable price action signals which are confirming our outlook from yesterday that [members-only content]. While we expect [members-only content], meaning the broader consolidation continues, green shoots continue to emerge on key timeframes which is certainly encouraging heading into a traditionally seasonally favorable period for crypto assets. 

4-Hour Chart

To begin we'll zoom into the 4-hour chart for a closer look at the short-term setup where we can see that SCMR is painting [members-only content] following some neutral and fairly bearish candles over the past 24 hours which is keeping near-term market structure intact and quite attractive, all good signs for the bulls moving forward. So is the fact that the moving averages were able to act as support on recent weakness, of which the EMA's are still moving to the upside, the 50 SMA just turned bullish today, and the 100 and 200 SMA's are flatlined but could easily turn higher if price breaks above the local highs, this despite price still being well within the bearish portion of the Ichimoku Cloud which shows [members-only content]. Finally, it appears as though an unorthodox ascending triangle is forming that portends a resolution up into the [members-only content] at some point in the not too distant future, although the lower supply area, the top of the Cloud, and the upper triangle trendline all reside between 6450 - 6500 $ so price will likely continue to struggle here for another day or two before making another move.

Moving on to momentum and volume, notice that Willy, RSI, and the Stochastic all recharged to their midlines over the past few days but are already reversing back to the upside with room to run, MACD has yet to cross below its zeroline so it is likely to move higher soon if price does, and PPO is still flashing weak sell signals which isn't great but shouldn't put the kibosh on the rally until there is some confirmation from other indicators. Fortunately for the bulls there is no confirmation from the volume indications which continue to lean bullish over the near-term, however the porous volume profile notch between [members-only content] $ remains a concern from a slightly longer-term perspective which is why we are still skeptical of the sustainability of this rally in general.

3-Day Chart

Next up is the 3-day chart where we still don't have much to work with in terms of candle formations due to the persistently stagnant MT price action over the past few months, although we can see that an SCMR [members-only content] printed yesterday just as price was closing above the long-term downtrend line for the first time this entire cycle, and the EMA's have also been broken to the upside and are starting to turn higher for the first time since early September, all of which is very good news for the bulls moving forward. Also note that the 200 SMA continues to rise, the 50 SMA is about to turn higher as well, and short-term market structure is improving overall given a small double bottom in the 6k $ region which could kick off a much more substantial breakout into the [members-only content] $ if the bulls can establish yet another higher low on the next bout of selling.

As far as momentum and volume are concerned, notice that Willy and the Stochastic are just starting to tick higher with plenty of room to run to the upside, RSI remains stalled out in no man's land but will aid the bulls if it can begin to move higher too, MACD is still flatlined at its zeroline but will poke above there if price continues to move, and PPO continues to flash neutral signals which isn't a great thing but also is not very worrying at this point given the other signals we are seeing. Throw in the fact that the A/D line remains healthy and elevated and the volume profile setup looks good overall and the bulls appear to have an opportunity to [members-only content], although we'll need to see exchange volumes pick up to confirm a true shift in directionality so we'll remain relatively conservative in our setups until that confirmation materializes.

Market Summary

In our opinion this market is showing a lot of potential for additional upside from current levels, perhaps even substantial upside, however if recent history is any indication then the bulls are still in trouble overall considering follow-through on any and all opportunities, bull or bear, have been squandered and ultimately led to more rangy-consolidation. While this certainly remains a possibility this time around, which is why we remain cautious on the market in general, the fact that [members-only content] could legitimately spark something a bit more significant heading into year-end (although more consolidation is also quite possible so keep that in mind as well).