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Friday Inferno market update

Friday Inferno market update

Analysis

TL;DR 2019 begins with a whimper, not a bang.

 

This week has seen very little of real note in the bitcoin markets. Traders are still on holiday, volumes are still low, and the decisive move we need to know where things are headed has so far failed to materialise.

 

The overall picture is more stable than it has been recently, but still broadly bearish. We’re trading below all the major daily moving averages. The 200 MA has dipped below $6k, the 100 MA is approaching $5k and, most interestingly, the 50 MA now sits below $4k – adding another layer of resistance for price to surpass. This is in addition to the resistance that already lies around $3,900, where BTC appears to have just put in a double top. There are headwinds to higher prices, shall we say.

 

However, some consolidation is occurring and bitcoin has not yet dropped back below $3,700 – the first layer of support. Below that, we have stronger support at $3,600. Right now, then, we’re trading in a fairly narrow range that we can expect to break out of one way or another soon. If the break is to the downside, then we’re probably looking at a return to the lows around $3,200 and the 200-week moving average. (This report suggests that the 200 WMA is a fair baseline for BTC valuation, though there’s no reason we shouldn’t dip lower in the short term.)

 

While momentum is still downward, here are some bullish thoughts to close.

  1. Circle executed almost $24 billion in 10,000 OTC crypto trades last year.
  2. Ignore the all-time highs and look at the yearly lows instead. These signal the number of holders who will never sell, no matter what. Lows for each year are:
  • 2012: $4
  • 2013: $65
  • 2014: $200
  • 2015: $185
  • 2016: $365
  • 2017: $780
  • 2018: $3,200

 

Stay tuned!

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