There’s good news and bad news, again…
On Tuesday we posted our analysis that bitcoin was painting an inverse head and shoulders, a classic reversal pattern. That pattern continues, with the price dropping dramatically from the $6,800 resistance level if failed to breach on Monday, down to $6,072 (Bitstamp) in the early hours of Friday – before staging a strong recovery.
A $600 fall isn’t great, but there’s a silver lining. Right now, bumping along around $6,200 is painting the second shoulder of the inverse h&s. The pattern began a month ago after bitcoin’s drop from the high $7,000s at the beginning of June. The first shoulder took around 10 days to complete – though if you take a look at the 4h chart, you’ll see it’s not 100% clear where each move ends. The neckline gently slopes downward from $6,800.
So that’s the pattern to watch over the coming week. As we said on Tuesday, $6,800 is the price bitcoin needs to stay above to validate the inverse h&s. If it doesn’t then, well, look out below.
In the news, we have the Trade Wars heating up between the US and China, which could prove extremely counter-productive in terms of global economic growth. Additionally President Trump, currently on a visit to the UK, has trashed Prime Minister Theresa May’s proposed plan for Brexit, saying that it will ‘probably kill’ a US trade deal. None of this is positive for the UK, US or the rest of the world – but it signposts incoming demand for crypto. Also good news for crypto is the proposed new bitcoin ETF, which looks like it stands some chance of approval.
The Bancor hack that we covered earlier this week has led to $12 million in ETH being dumped on the market – not a huge amount in the grand scheme of things, but nevertheless significant. Lastly, John McAfee is getting legal on HitBTC, promising $20 million to a suit against them if they don’t answer his emails. His complaint appears to arise from his dissatisfaction with the withdrawal fees charged on the Docademic token.
Red hot news, scorching wit and searing opinion pieces from Crypto Inferno.
Join us on Telegram