Bitcoin's Indecision Points to Further Downside
- Bitcoin struggling to move higher despite Korean Won buying interest.
- Ethereum rally fizzles out but support is near.
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After a couple of wild days in the crypto-currency space with new all-time highs made before a sharp sell-off, Bitcoin is currently trading ‘mid-range’ but looks as if the downside is the path of least resistance in the short-term. And the two large indecision doji’s on Wednesday and Thursday also point to a market that may have pushed ahead too far, too soon. BTC has made three lower-highs in a row, after touching just under $11,500 on Wednesday, while the speed of the sell-off this week hints that there are a lot of loose holders currently in the market.
- Wednesday November 29 - Bitcoin Rally’s to $11,000; Caveat Emptor
- Thursday November 30 - Bitcoin – ’Rickshaw Man’ Warns of a Big Reversal
Chart: Bitcoin (BTC) Daily Timeframe (July 2 – December 1, 2017)
We discussed the potential downside of BTC at last week’s Bitcoin webinar - if you would like to join us every Wednesday at 12:00pm for updated news and views, please click here.
A look at the IG Retail Sentiment Indicator also throws a bearish shadow over Bitcoin with investors heavily long of the crypto-currency, and increasing their long positions over the last week. We use this a contrarian indicator with a large long position a negative for the market.
The second-largest crypto-currency by market cap, Ethereum, also hit a fresh all-time high this week before giving back a large part of its gains. The chart highlights that the recent strong uptrend has been broken and a further downside move could see Fibonacci support at $395 ahead of $353 tested.
Chart: Ethereum (ETH) Daily Time Frame (August 24 – December 1, 2017)
Market Moves/Top 8 Capitalizations – December 1, 2017
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--- Written by Nick Cawley, Analyst.
To contact Nick, email him at email@example.com
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.