Published 7th July 2019
Volatility has spiked to highest levels since 2018 at the end of June as we observed a fear of missing out (FOMO) rally followed (as expected) by a sharp decline: a correction from 13,800 down to 9,600 (over 30% drop) . Many bitcoin traders have been waiting for a price correction since the beginning of the rally back in May. Have we hit the lowest point at 9,600 or is the price going to drop further? Even though volatility seems to remain high at the beginning of July with prices moving from below 10,000 quickly above 12,000, the 30, 40 and 50 Exponential Moving Average (EMA) ribbon shows through its compression that price volatility has decreased substantially. It has become common with Bitcoin that a strong movement suddenly happens following a period of reduced volatility and trading volumes. We are seeing the bitcoin price evolving within two triangles and we expect a brutal move when the price will eventually break out of any of those shapes. A succession of lower lows is typical of a downtrend movement and there is a possibility that prices will go further down. Resistance levels and price targets following a breakout of the two triangles are mentioned in the H4 analysis and the Summary section. In the event where the price was to break above the lowest highs of end June there is possibility that the price would rally to the previous high of June since there is little resistance between those two levels.
Weekly (W) Analysis
No resistance until 13,800 No support before 8,700 Strong support around 6,500
Resistance and Support:
Resistance box (red) at 13,851.74 | 16,261.37 Support box (green) at 8,724.50 | 8090.27 Support box (green) at 6,700.46 | 6141.03 Moving Average 21 6,400 Moving Average 20 6,600 EMA 20 7,400
14th July 5,100 | 4,700 21th July 5,200 | 4,780 28th July 5,300 | 4,870 4th August 5,400 | 4,900 11th August 5,500 | 5,000
Daily (D) Analysis
No resistance until 13,800 Medium support around 9,600 Strong support around 7,700
Resistance and Support:
Resistance box (red) at 13,851.74 | 16,261.37 Support box at 8,711 | 7,614 Support box at 5,760 | 5,035 Moving Average 50 9,304 Moving Average 100 7,413 EMA 20 10,672
8th July 9,717| 5,050 18th July 10,628 | 5,672
4 hours (H4)
Support with little triangle, big triangle, horizontal resistance line at 11174 and 9823 and the two green rectangles. Strong support where the triangle and the support rectangle converge. Medium to low resistance with the triangle and the horizontal lines 12,003, 12,464. Breakout out of small triangle before 11th July, breakout out of large triangle before 20th July. Breakout bullish outside of the triangle above 11658 (lower as time goes) First potential resistance at 12,003. Second potential resistance at 12,464. Bull trend confirmed above 16464 with price target of 13,800. Breakout bearish outside of the triangle below 11174 (higher as time goes) Potential resistance at 9,823 or slightly above (price could bounce on trend line). Bear trend confirmed below 9,600 with first price target of 9,000 second target below 8,000.
Weekly time frame targets around 8,000 or 13,800 Daily time frame targets around 9,000 or 13,800 H4 time frame targets around 9,000 or 13,800