Our patience has paid off
It’s the middle part of March 2015 right now, the sun is shining and signs of a long winter are slowly fading away. The beginning of spring seems to have helped Bitcoin reach equilibrium against the US dollar. We have closed quite a few long positions since our last Bitcoin related article and now it’s time to sit back and observe the market a little closer because we are bound to have some drawback right about now.
Bitcoin price in March 2015
We are reaching closer and closer to the overbought market condition which most likely means that the price is bound to correct itself pretty soon. There are good solid support levels around 286.675 and 283.701 and it’s likely that the price is going to try those levels throughout the other half of March, 2015.
Unless something extraordinary happens in the crypto currency world I estimate another bullish run not before April. So bulls, I’m afraid you’re going to have to hold back for a while, but know this: your time will always come!
First licensed Bitcoin exchange opening
The first licensed U.S based Bitcoin exchange will be opening later today which is great news for all the bulls out there because this move is likely going to bring back a lot of lost trust for the crypto currency, Bitcoin.
While I am very surprised to see a move like that from the U.S I am happy it has finally been done. There are serious money involved and since it’s now licensed and approved in many states, the chances of someone running away with your coins has decreased a lot- therefore more people are going to trust the exchanger with their coins and because they take no fees for the first two months we can expect a buying marathon to take place very soon.
All the way up
Just yesterday on the 26th the price per Bitcoin jumped all the way to $303,303 USD which is the highest point yet in our newly forming upward trend. From there the price correction occurred all the way down to $241,094, but we’ve confirmed with the two new bullish candles that this is likely going to be the end of it. We can be fairly confident that the resistance level of $271,372 is going to be breached later today or some time tomorrow.
The beautiful upward trend that is forming on my charts along with the fact that today Coinbase is going to make history it’s quite safe to go long in BTC/USD. Just promise me you will make up your own mind before you blindly take my advice, that’s all I need to know.
Slow and steady gains
The price of Bitcoin has been slowly recovering from the biggest drop we’ve seen since the year 2013. For the last ten days the price has steadily been moving upwards after a bullish breakout closer and closer to the resistance level at around 260.7 USD. I am fairly confident that at least up until this point there shouldn’t be anything that will stop the trend. We will most likely see some fallback around that level, but if all goes well the 260 USD mark will be broken at the end of January or early February.
Pivot point calculator
Since I have upgraded to a much more professional software, the MetaTrader 4, I now have a lot better indicators and overall user interface. I was looking around for a MT4 pivot point calculator script and I found some, but I can’t be sure how reliable they are or what algorithm they are using so for the time being I am still using this: Pivot Point Calculator. I will let you know once mine is ready- I am planning on making one really soon because it’s not really making sense to manually type in those pivots every morning, right?
Right now the lowest point BTC has reached is $167,125 USD per coin. Let’s hope it will stay that way!
But there are still a few mixed signals here. For example we all know that this bullish movement was inevitable simply because we have been dropping since the beginning of the month. As I mentioned in my previous post we have been lingering in the oversold area for too long.
So this bullish movement might not mean anything else other than a simple correction. Also if you notice how the second bullish top is a little bit lower than the first, this might give you some ideas as well.
On a more positive note we haven’t yet reached oversold market conditions so a small bullish bump is pretty likely. We can’t yet say for sure that all this is going to reverse the overall trend, but looking at how the highest candle closed outside of the Bollinger Bands at $222,02 per coin, we could see some upward movement indeed.
Did you hear about Russia starting to ban Bitcoin websites? I’m not yet sure what this will do to the price, but it surely must have some serious impact. I don’t really understand the logic behind this move from Russia, but considering how many Russians are using Bitcoin online it will probably stir up something pretty soon…
Bitcoin now worth less than $200
The two hundred dollar mark has been breached earlier today when Bitcoin fell from 225,703 all the way through 200, briefly touching the $176 region, but getting some decent support around $180-$190 later.
The drop seems much more significant now than it did yesterday when I suggested going short for short term. Nice round numbers like 200 are key points in all trading simply because people like these numbers. The breach below 200 just gave a pretty strong blow below the belt for all the bulls.
Bitcoin mining not profitable
Back when Bitcoin was still worth $700 and more people were already talking about the profitability of mining new coins. That’s when the talks started about Bitcoin losing its value simply because the mining costs were increasing exponentially as new blocks were discovered. Given that the crypto currency is now worth less than two hundred bucks, it’s very likely that we are going to see some serious crash as Bitcoin is slowly becoming worthless.
The grim future of Bitcoin
Small time miners and computer nerds are already starting to shut down their mining rigs, trying to sell the hardware cheap on eBay or simply moving to easier to mine crypto currencies like Doge for example. This means that the mining power is slowly but surely moving away from the regular folks and into the hands of big players and organizations who have the type of hardware required to mine Bitcoin. Definitely not the type of “freedom” we had in mind…
As you can see I have finally updated to a better, more sophisticated software. The price chart looks a lot better now with a lot of custom features and I already looked into MQL4 programming language which at first glance seemed epic easy to master so keep an eye out because in the future I could create a trading robot for Bitcoin ;)
Other half of January
It’s not looking good for the bulls- at all. The breakout since the early days of year 2015 has been harsh for the bulls. Bitcoin has now fallen from $317,3 all the way to $226 and it’s showing no signs of stopping any time soon. Remember, we are dealing with the lowest point of BTC since March 2013. The fact that we couldn’t break the barrier of Jan the 3rd which was $289, on the 7th of Jan (which is the highest point for price correction) means that we have a confirmed downward trend. Just look at that last black candle of death…
So what should we do?
I’m a bull myself and I never make good trades from selling, but if you want to give it a try then wait for another price correction up to some $264 area and then go short. It makes more sense to sell at this time. I personally haven’t YET given up all hope and I will be waiting for an opportunity to go long instead. It might not happen any time soon, but we have been lingering in the oversold area for too long already.
Bitcoin in the year 2014
We started out strong this year! After the traditional years end selling marathon where the BTC fell from its highest point yet, the $1200 area, we quickly recovered in January 2014 from $600 all the way up to $1000 again. Investors were confident that Bitcoin is the new goldmine.
The media coverage
It’s no surprise that the media was creating a fuss about Bitcoin considering that BTC is a commodity that suddenly exploded from $100 to $1200 in just a few weeks. Everybody was talking about Bitcoin in 2014. People were creating new businesses that solely relied on Bitcoin as a currency and even the government, the banks and the IRS were taking Bitcoin seriously. All this controversial publicity reflects nicely on the charts as well- it’s almost as if BTC became alive! Heck, even PayPal added limited support for Bitcoin.
What goes up, must come down
Surely something that suddenly rises to such heights must come down eventually and chill for a while to balance things out. This is exactly what happened throughout the year 2014, the BTC/USD gradually came down from the high losing the hard on it had from all the media fuss.
What to expect from 2015
If you look at the yearly chart (above) you can see that we are currently at the lowest point yet ever since this whole madness started back in 2013. Because we are getting closer and closer to years end a lot of investors are raking in profits for a fresh start next year so the mass selling of BTC right now seems pretty normal to me. I am kind of disappointed to see that we broke through a nice solid support level in the $320 area though. Looking at this makes me believe that the maximum buying potential for BTC in 2015 shouldn’t get us higher than $600, maybe $750. It will need some serious super powers to get past that point.
Right now we are probably going lower from here as the years end is creeping closer and closer so don’t get too crazy when you wake up one morning and find that BTC is worth only $250. The $320 area support level was a serious breaking point and there’s nothing left to stop the selling any more other than the deliciously low price itself which will surely get investors back to buying, especially in the first month of 2015.
Tips for 2015
- Sell all your Bitcoins until the new years eve.
- Wait for a week or so.
- Start buying up coins and enjoy the rally.
- Look out for any media coverage (good and bad).
- Keep an eye on this blog ;)