Bitcoin Price Report for January 9, 2017

Jan 9, 2017 --- (ARCHIVED) Free Reports

Market Commentary:

Once again it was a rather interesting weekend from a price action perspective, one that has at least given us some near term support and resistance levels to work with during what we think will be an extended consolidation going forward.  Despite the fact that we were stopped our of our VST ProTrade off the [members-only text] level at breakeven on Friday, we think this turned out to be a good call considering price went all the way down to 812 $ prior to taking the rest of the weekend to rebound back to the current 900 $ level.  While we think volatility can stay relatively elevated over the course of the next few weeks, we think ultimately price [members-only text] yet again.

As far as the technicals go, things are slightly more bullish than they were last week, however timeframe discrepancies remain prevalent which is one of the main reason why we think the market could move sideways for awhile.  Notice on the 12-hour chart below that SCMR is still painting [members-only text] following a [members-only text] bar, while new dynamic resistance builds around [members-only text].  Also note that market structure remains fairly bearish while price bounces between the upper demand area and the lower supply area, a sign that indecision is already creeping into the medium term charts not a week into this correction.  Where price bottomed is also critical seeing as though the 812 $ spike low tagged the short term trendline, the [members-only text], and the still bullish Ichimoku Coud, not to mention not one candle has yet to close below the upper demand area.

Additionally, the market could be in the middle of a Wyckoff buy model which implies [members-only text], however the speed and magnitude of these initial drops are such that we still think the likelihood is that this becomes a [members-only text] or a handle to a large Cup & Handle off of the 2013 1163 $ high.  Finally, momentum has recharged nicely so far given the Stochastic has been pinned in oversold territory for a few days, Willy and RSI appear to be trying to bottoming close to oversold territory, MACD has completed a deep retracement, and PPO is flashing strong buy signals once again.  All in all, not bad considering how violent the dumps have been over the past week, which tells us that this is likely another [members-only text] rather than a longer term trend change.

We move on to the daily chart now for comparison purposes, mainly in terms of momentum. Despite the Stochastic making progress into oversold territory, Willy and RSI still have room to run if their [members-only text] are broken, MACD is still searching for a bottom, and PPO has yet to stop flashing strong sell signals.  Throw in the fact that SCMR is painting a [members-only text] of the [members-only text] yesterday, as well as new dynamic resistance at [members-only text], in conjunction with what remains bearish exchange volumes, and we see no reason why a move back to the [members-only text] needs to materialize anytime soon. Having said that, there still are no SCMR [members-only text] on the daily chart and the A/D line continues to show more accumulation than distribution at these levels, both indications that this is indeed a consolidation.

Generally speaking, we see no reason to deviate from our thesis that the bitcoin price remains in a long term bull market that has yet to see cycle highs, although given the new year rally we saw over the holiday season we think at least a few weeks of [members-only text] action is in order.  This would give sellers a chance to take profits, buyers a chance to re-accumulate long positions, and would reset all of the momentum indicators regardless of timeframe.  In the context of this outlook, our call for another [members-only text] in February or March seems perfectly reasonable and attainable.
Posted ProTrade Ideas:

1a.) **Bitcoin ProTrade - Very Short Term [ISSUED on 1/9/2017]**:  We will consider a [members-only text] position in the [members-only text] area with a stop around [members-only text] and a target of [members-only text].

2.) **Bitcoin ProTrade - Short Term [UPDATED on 1/9/2017]**:  We closed our [members-only text] position off of the [members-only text] level at breakeven for no gain or loss.

3.) **Bitcoin ProTrade - Medium Term [UPDATED on 1/9/2017]**:  We will consider a [members-only text] on a move to the [members-only text] area with a stop around [members-only text] and a target of [members-only text].

4.) **Bitcoin ProTrade - Long Term [ACTIVE; UPDATED on 1/9/2017]**:  We will stay [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text].  We will add to the position in the [members-only text] area.
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