Last updated on June 12th, 2015 at 01:49 pm
It’s our first technical analysis together! I’m a new writer here at CoinBuzz but I’m hoping work through some market analysis and dive into the numbers generated by bitcoin markets and the like.
There’s not too much to our analysis this morning since the market range seems bound around its current trend of around $255 USD/BTC; though there is a slight negative trend that has held since mid-March. Let’s take a look at a four hour time frame:
This gives us about a month of market prices to look at and I think it’s a good window to start with as any. As I mentioned before, there’s a downward trend with mid $260’s in the middle of March and moving towards $240 and now the current price of $255. I’m new enough to to bitcoin market analysis but I’ve been trading regular stocks long enough for the terms “bear” and “bull” market to mean something but I want my articles to be readable both for beginners and experts so that all readers can take something away from these technicals. I’ll turn to Investopedia for some help here. So we’ll get an introduction here that you can skip for the rest of the technical.
“A bull market is when everything in the economy is great, people are finding jobs, gross domestic product (GDP) is growing, and stocks are rising. Things are just plain rosy! Picking stocks during a bull market is easier because everything is going up. Bull markets cannot last forever though, and sometimes they can lead to dangerous situations if stocks become overvalued. If a person is optimistic and believes that stocks will go up, he or she is called a “bull” and is said to have a “bullish outlook”.”
“A bear market is when the economy is bad, recession is looming and stock prices are falling. Bear markets make it tough for investors to pick profitable stocks. One solution to this is to make money when stocks are falling using a technique called short selling. Another strategy is to wait on the sidelines until you feel that the bear market is nearing its end, only starting to buy in anticipation of a bull market. If a person is pessimistic, believing that stocks are going to drop, he or she is called a “bear” and said to have a “bearish outlook”. “
Terminologies established, now we’ll move into the two hour time frame for a better view of the downward trend and why the market looks bearish even with the hard fight the bulls are currently engaged in:
The bulls are fighting strongly right now to bring more market momentum and turn the price up but the technicals tell a different story. There’s the downward trend I mentioned before and there are some strong bearish candlesticks (bars with pluses on graphs) to indicate this. Recent trends are pretty soft right now and we’re moving into a short zone where we may move towards a $240 price range. It may even be possible that the price may move into the low $200’s and that’s good news for acquiring more coin for your dollar in trades. Again, this is just a possible target if the downturn continues.
The bulls are really, really fighting a fierce market right now despite the bearish indicators we’ve reviewed so far; in either case this might be from false market indicators or buyer desperation driving prices down. Once the bids start to slow down some we can reevaluate more mid-range prices and hopeful uptrends in price. Indeed, I think we all enjoy it if prices are rising; particularly if you acquired coin at a short and low position.
Market analysis and speculation aside, we always want to minimize risk with bitcoin’s volatility at any point in time. That said, a short position around $258 to $260 would be a good place to position trades with a stoploss at $245 to solidify any cash positions for risk management. Unfortunately the entry threshold to take advantage of possible price spikes will likely be a short one, so we’ve got to watch carefully.