Bitcoin (BTC): Daily Price Action (Fri, 14-Apr-2018)

For education only.

Price (pausing at resistance)

Following on from yesterday's review (here) and BTC's outsized pop, the price is now holding around the $8,000 level testing the months-long descending trendline (red line).

Immediately after the pop, the price was over-extended (i.e. trading well away from the moving averages), but did not retrace and is now hugging the trendline resistance, a bullish sign.

I'd like to see a retrace (into the support zone), form a price pattern e.g. interim double bottom, falling wedge, from which we can identify a long entry point: a small-bodied reversal candle could be used if no obvious price structure emerges, but I think the market still needs to relax more before continuing northwards.

Of course this could all be a fakeout and this is simply an oscillation in the downtrend. A convincing break and close above the $8,000 level would make this scenario less likely.

Volume

Yesterday there was a significant spike in trading volume (Bitfinex), but has since quietened down, but holding steady (potentially a good sign for controlled price movement).

The On-Balance-Volume (OBV) indicator is making higher highs and higher lows indicating at least a short term up trend. It appears to be setting its sights on the months long descending trendline resistance (thick, red line) - indicating continued accumulation.

Trade Strategy (pullback, break, long, continuation)

We're looking for the price to pull back under $7,800, pause above $7,400 (support zone), form a price pattern to set entry/exit points, and then go long with a target in the resistance zone (~$9,000)

Until tomorrow,

Bobby
(Trader)