BTC Update Tuesday 13th August - BOOM!
Monday 12 August 2013
Following the bitcoin market's refusal at resistance last Friday, we were anticipating a further retest of $101 as support and bracing ourselves for a further down-move to at least $97 if it gave.
In the event sufficient new buyers came into the market that we never even got back down to $101 support, instead we have steadily gathered upside momentum and within the last hour, resistance at $105 was re-attack with a vengeance and for the time being, at least, defeated.
Here's how it looks on the chart:
Whenever the market fails to do what looks certain, it provides a powerful signal. In this case we have learnt that having set themselves up to drive the market lower, the combined power of bitcoin bears was simply insufficient to carry-through.
Put another way, the bear thesis has been proven wrong and the bulls have taken charge again.
As you can see, the market is currently challenging a combination of horizontal and sloping resistance right now; there will certainly have been a band of sell orders here and this has already been a small reaction.
While we don't know yet whether this reaction will build the most probable outcome is that it will be defeated as new bulls take advantage of any retracement to add to their positions and this will pave the way for a re-test of $112 as resistance.
Having said this now is not, in our opinion, the moment to buy; this happened down at the first retest of $101, which held as support and provided us with the opportunity to buy at wholesale prices with a nice tight loss-stop and delivering the best 'traders-equation'. Currently the market is trading at the median point between support and resistance, so while the sentiment looks good, the maths doesn't.
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