Updated BTCUSD forecast and Bitcoin analysis for the next week
In this post I applied the following tools: fundamental analysis, all-round market view, market balance level, volume profile, graphic analysis, trendline analysis, the Kagi chart, the Tic-Tac-Toe chart
I’m back to my Bitcoin price forecasts. I deliberately didn’t analyze Bitcoin performance last week, as the situation was the same and in general corresponded to my previous forecast; so it was just boring to repeat the same things. Last week, there were a number of interesting events worth mentioning; but first, let’s see how the market is meeting the scenario, I suggested last time.
(BTCUSD scenario, dated 29.10.2018)
(BTCUSD current situation as of 12.11.2018)
As it is clear from the two charts above, the price moves of the BTCUSD were predicted rather accurately, and the ticker deviated from the scenario within the margin of error.
Should we count on Bitcoin price rise according to the previous scenario, or it rather to continue trading flat or even to drop?
To find out, let’s start with Bitcoin fundamental analysis.
Bitcoin fundamental analysis
Among all the events for the past two weeks, there are two highlights that may seem to be independent of each other, but they resulted from the same things.
02.11 – IDEX announced the KYC procedure, which stands for Know Your Client. The procedure suggests global verification of all IDEX users. Those, who deny this procedure, won’t be able to trade on the exchange any longer. In this context, the exchange can’t be called decentralized. But in the same announcement, the IDEX administration explained that the exchange is basically a hybrid platform, as if trying to justify the clients’ total verification, claiming that the complete decentralization is not always good.
The exchange administration is charged by many users with abusing the concept “decentralization” and should have explained everything in the very beginning.
08.11 – the founder of EtherDelta Zachary Coburn was charged by the SEC with operating an unregistered securities exchange; SEC, in fact, equates all ERC-20 tokens to securities. Finally, Coburn agreed to meet the regulator’s requirements and pay 300 000 USD form the profits made, 75 000 USD more as a fine for violation the Act, and another 13 000 USD as bail until the court decision. This case is a big precedent, as before, there used to be a common opinion that if an exchange didn’t operate with fiat, it was relatively free from the regulator’s pressure; however, it has turned out to be different in fact.
These two events represent the willingness of the SEC and the FATH to regulate the cryptocurrency market, so they can affect any cryptocurrency exchange or a security-token, issued to attract investments.
To check whether the token you’ve bought a security one or not, you only need to answer the following questions:
Is the token buyer suggested to receive incomes?
Is investment the main function?
Does the token holder receive incomes from the third party?
Are the funds, raised from selling the asset, invested in the company development?
This test was developed by the US Supreme Court and is called Howey.
Basically, if a token is recognized as a security, it is subject to the US securities laws, according to which the issuer must be registered and pay the taxes on the incomes, generated from selling these tokens in the U.S. Obviously, most of the holders won’t be willing to register, which can cancel their trading in the US markets and result in possible delisting.
These regulatory measures are just beginning the active stage and the above cases have been the first signs of limiting the cryptocurrency confidentiality and the official control over the cryptocurrency market
Of course, this process creates tension in the market and can result in the strong outflow of illegal funds. Therefore, there may extreme volatility in the crypto market. Some assets may be completely removed from legal trading. So, currently, all long-term investors must be extremely careful and revise their portfolios.
In the chart above, you see that the latter event resulted in the BTCUSD strong drop. It is clear that there will be more similar charges of the cryptocurrency exchanges and the same cases may repeat again.
To find out where the cryptocurrency benchmark will be heading during the next two weeks, I suggest technical analysis of the Bitcoin price to the US dollar.
BTCUSD technical analysis
The situation in the monthly BTCUSD chart looks like this:
October candlestick has a very long tail that I called manipulation with Tether. So, I won’t take this level into consideration in my technical analysis.
The nearest resistance levels at monthly highs are at 7429 USD and 7756 USD (green lines). The nearest supports are at the monthly lows at 5858, 6100 и 6220.
Keltner Channel’s center line is at 6156 USD, which strengthens the support zone and creates a powerful zone for bulls in the range of 5858 USD - 6220 USD.
I should note the point of control in the volume profile, being at around 6432.70 USD.
According to the BTCUSD ticker location, it is about to drop from this level down.
The weekly timeframe in the chart above doesn't suggest anything surprising. Everything remains the same. A typical sideways trend with a slight hint at possible rise (MACD is in the green zone, RSI stochastic is about to paint a bullish cross).
In the daily Bitcoin price chart above, the ticker is at the crossing of two strong trendlines. It is not a triangle anymore, as the lines start in different time periods. The bearish trend starts from the May’s high, and the bullish one is drawn in the daily chart and starts in October.
Based on the idea that the longer the trend is, the stronger it will be, I can assume that the Bitcoin price is likely to be pressed down towards the support zone of about 6220 USD – 5828 USD per bitcoin.
It is suggested by both the ticker, and the MACD that is currently in the red zone.
As it is clear from the BTCUSD 12-hour chart above, the oscillators are in the oversold zone, and the ticker has drawn a shooting star pattern at the last Japanese candlestick. The pattern will be confirmed if the last candlestick of November 12 will have at leas ta small black body.
In the Kagi chart, there are multiple supports in the zone of 6251 USD – 6242 USD. If the ticker goes lower, there will the first barrier to bears in the zone. Bulls neither have any room for growth. At 6572 USD, there will be the first strong resistance for bulls.
The Tic-Tac-Toe chart doesn't also provide a clear picture. The upper trendline was broken out within the swings in October, so it can’t be an accurate signal. So, the only exact levels in the chart are the support levels at 6286 USD and at 6151 USD. The upper global growth limit is still at 6895 USD.
Updated BTC price forecast and BTCUSD trading scenario
In the context of the recent regulator’s measure and the general stagnation in the market, bitcoin is likely to go down in the bearish correction inside the trading range towards the support zone of 6250 USD -5850 USD, with a possible penetration in the form of a wick. This zone is convenient to enter purchases as it easy to figure out the stop loss level; so, I expect large buyers to be active in the above zone, as they have already entered at these levels.
The feature of this trajectory is that there are no clear signs of manipulation, which suggests that the market is moving is rather naturally, than manipulated by big players at the moment.
That is my BTCUSD trading scenario for the next two weeks. Read my forecasts for Bitcoin and other cryptocurrencies in the trader blog. Go on following the Bitcoin price and staying informed on the cryptocurrency market. I wish my Bitcoin price predictions are useful for you!
I wish you good luck and good profits!
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Price chart of BTCUSD in real time mode
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