Bitcoin Price Report for May 8, 2017
May 8, 2017 --- (ARCHIVED) Free Reports
Unsurprisingly the market went into consolidation mode over the weekend as overbought technical conditions prevented the bulls from breaking price out to new highs, while a continuation of the supply/demand imbalance kept prices elevated above 1500 $ the whole time. Now price appears to be back to a [members-only text] following a series of rejections down into the low 1500's $ multiple times over the past few days. While BitStamp is still lagging behind the other Western exchanges to an even greater extent now, we think it more likely that Stamp catches up to them rather than them retracing to meet Stamp. This implies that [members-only text] is coming if Finex and Coinbase can stay elevated above 1600 $ for at least the next 24 hours. If so, then new [members-only text] seem like a pretty good bet at some point over the coming days.
Today we return to the trusty 6-hour chart for a look at the short term technical setup going into what could be another very good week for bitcoin. We can see that market structure is coming in bullish during this pause in the action, while SCMR returns to [members-only text] following some mixed signals in the form of [members-only text] bars and [members-only text] candles. Also note that price has been following the 19 EMA to the upside all weekend acting as support on dips, while the other moving averages continue to stack to the upside thus still confirming [members-only text]. Additionally, the Ichimoku Cloud is still bullish and expanding to the upside, the medium term uptrend line remains intact, and multiple levels of dynamic support continue to build below the market.
On the other hand, momentum remains stretched despite a fairly nice recharge over the first half of the weekend, although MACD and PPO are indicating that perhaps that is all we will get this time around. We can also see that trading volumes are now favoring the bears, the A/D line looks ok but is rolling over slightly, and volume profile remains porous below the market (especially between [members-only text] $). Given the bullish indications we discussed in the paragraph above along with momentum and volume indications that are [members-only text], and we think the path of least resistance continues to be to the upside for the time being.
Moving on to the medium term forecast via the daily chart below we can see that price remains in the [members-only text] zone, as well as in a new small supply area created last week off of the ATH. Also note that while the most of the recent candles are still [members-only text] in terms of SCMR, they are also showing rejections above the psychologically significant [members-only text]level creating the beginning of a what could be a bearish topping pattern known as "turtle soup". While this is not a death knell formation by any means, it does signal that we need to reach new ATH's sometime relatively soon or else the bulls will be in jeopardy of [members-only text].
As far as momentum and volume are concerned, Willy and the Stochastic are still extended but have recharged a smidgen over the past few days, however RSI remains officially overbought, MACD is rolling over, and PPO is still flashing strong sell signals. Throw in a languishing A/D line and still porous volume profile down to around [members-only text] and we think the bulls need to get things going soon or else the tide will likely shift back to neutral, or even perhaps [members-only text], as we could then see our first major pullback of the Spring of 2017. While we think that this is unlikely for now, it is certainly a possibility.
Seeing as though our call for a sideways consolidation over the weekend indeed materialized as price stayed well within the [members-only text] range, we want to stick with our current ProTrade setups due to optimal risk/reward profiles and proper risk management. While it may be tempting to chase price at current levels, there are much more attractive areas both above and below the market that we would rather entertain. For this reason, and the many mentioned above, we will stay patient and ready with dry powder for more favorable [members-only text] setups over the course of this week.
Posted ProTrade Ideas:
1a.) **Bitcoin ProTrade - Very Short Term [UPDATED on 5/6/2017]**: We will consider a [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text].
1b.) **Bitcoin ProTrade - Very Short Term [UPDATED on 5/6/2017]**: We will consider a [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text].
2.) **Bitcoin ProTrade - Short Term [UPDATED on 5/6/2017]**: 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].
3.) **Bitcoin ProTrade - Medium Term [UPDATED on 5/5/2017]**: 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 [UPDATED on 5/2/2017]**: We will consider a [members-only text] off of the [members-only text] level with a stop around [members-only text] and a target of [members-only text].