Strange movements in the Bitcoin's price.
Updated
This is a chart of the Bitcoin's price in USD of the last two weeks. We can see unusual patterns in it that makes it difficult to predict the direction of the price of the Bitcoin for the next few weeks.
While there is enough evidence to forecast a bullish development of the Bitcoin, the bullish forecast did not get confirmed. A triangle is a formation that is usually followed by a continuation of the ongoing trend. I did expect the price to exit triangle A in direction of the blue arrow. Instead, the price broke the lower border in direction of the red arrow. Following this downwards outbreak, the price of the Bitcoin went up from 12050 to 17234. There, it was already exhausted and started to move downwards, building another triangle B, which lets us expect a downtrend.
While the uptrend is still valid, an outbreak of triangle B on the lower side of triangle B would change the outlook of the Bitcoin massively. Instead a comfortable journey up to 22500, we would see a free fall as deep as 5568.
Why is this uncertainty? There are three forces influencing the price of the Bitcoin:
1. There are the investors who are interested into a permanently rising value of the Bitcoin.
2. There is a growing demand for Bitcoins. As there is a maximum of 21 million of coins, the growing demand for the coin will increase its price on the long-term.
3. The governments of the USA and Bulgaria own sized Bitcoins for 3 billion US-Dollars. They want to sell them and this will give some serious pressure on the Bitcoin and may even lead to a "massacre" of its price.
This constellation will lead to erratic and unforeseen price movements of the Bitcoin in the next months. Whenever many buyers are on the market, the governments will flood the market with their sized Bitcoins. This makes it difficult to predict the price and otherwise reliable chart signals may not work during this time.
While there is enough evidence to forecast a bullish development of the Bitcoin, the bullish forecast did not get confirmed. A triangle is a formation that is usually followed by a continuation of the ongoing trend. I did expect the price to exit triangle A in direction of the blue arrow. Instead, the price broke the lower border in direction of the red arrow. Following this downwards outbreak, the price of the Bitcoin went up from 12050 to 17234. There, it was already exhausted and started to move downwards, building another triangle B, which lets us expect a downtrend.
While the uptrend is still valid, an outbreak of triangle B on the lower side of triangle B would change the outlook of the Bitcoin massively. Instead a comfortable journey up to 22500, we would see a free fall as deep as 5568.
Why is this uncertainty? There are three forces influencing the price of the Bitcoin:
1. There are the investors who are interested into a permanently rising value of the Bitcoin.
2. There is a growing demand for Bitcoins. As there is a maximum of 21 million of coins, the growing demand for the coin will increase its price on the long-term.
3. The governments of the USA and Bulgaria own sized Bitcoins for 3 billion US-Dollars. They want to sell them and this will give some serious pressure on the Bitcoin and may even lead to a "massacre" of its price.
This constellation will lead to erratic and unforeseen price movements of the Bitcoin in the next months. Whenever many buyers are on the market, the governments will flood the market with their sized Bitcoins. This makes it difficult to predict the price and otherwise reliable chart signals may not work during this time.
Note
Update January 10, 2018, 06:51.It seems to me that we reached the floor. The downward move to 13293 is dead. We have to stop the down-trade.
Instead, there will be a short-term move up to approximately 15400. Just remember, that in this volatile situation, every trade is a risk.
Note
Update January 10, 2018, 06:51.It seems to me that we reached the floor. The downward move to 13293 is dead. We have to stop the down-trade.
Instead, there will be a short-term move up to approximately 15400. Just remember, that in this volatile situation, every trade is a risk.
Order cancelled
Update January 10, 2018, 2:18 PM.While it seemed in the beginning (6:18 AM) that the quotation of the Bitcoin would soar to 15500, the price movement turned and went down to 13412. From there, the price of the Bitcoin recovered and it is right now at 14108.
Why does Bitcoin behave so moody and against all the rules of chart technique? I never experienced such an unpredictable and grotesque situation before and I think that all warning lights in our brain should flash.
I just got a phone call from a Bitcoin trader from London. He was telling me about rumours about China. According to these unconfirmed rumours, China will take action tomorrow (January 11, 2018) , which will explode the Bitccoin bubble. I could not yet confirm this worring news. However, the man sounded so alarming that I sold all my Bitcoins. I will make a trade with CFDs to the downside of the Bitcoin's price tomorrow. Even if I cannot confirm the rumours.
Trading on unconfirmed rumours is very, very risky. Don't blame me, if you lose money! And don't blame me, if you take no precaution and lose money on the Bitcoin.
Note
Actually, we read a lot about on which level we should assume a bearish scenario. On this chart, it is defintively the thick, red dotted trendline. Once the price of the Bitcoin undercuts this red trendline, the overall bearish scenario will be confirmed. Another confirmation of the ongoing down-trend will be the undercut of level 11159. Above the red dotted trendline, there can still be a surprize and a bull-trend can take over at any time with targets at 19500, 22500 and 24400. However we have to think about the overall scenario with the US-government and Bulgarian government flooding the market with a huge amount of Bitcoins. And there is still the chinese rumour threatening the well-being of the Bitcoin.
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