BTC/USD weekly outlook for Bitcoin Broker
Welcome to a new week everyone, and if you’ve been following the previous analysis so far, you will agree with me that our analysis on Bitcoin vs. the U.S dollar has been on point. Our projection for the bitcoin price last week was that the pair would establish lower lows following the roller coaster of the bearish divergence pattern. Our overall forecast last week still tends towards the $6500.00 low. Let’s zoom in and look into the most recent fundamental and technical analysis of this week.
News on Speculative Adoption
In the news is Spencer Bogart, a Wall Street blockchain analyst urging investors to sell off their Altcoins and buy Bitcoin. He went on to reiterate that Bitcoin remains a strong buy despite recent losses. Spencer’s main point was that comparing Bitcoin to Altcoins, Bitcoin is beginning to have the institutional backing and most Altcoins are overvalued and are not delivering on their promise. He also mentioned that he would sell Altcoins such as TRON, IOTA, Cardano, and Neo; however, would hold Ethereum, Bitcoin Cash, Ripple and EOS.
Bogart compared the ICO boom in late 2017 and early 2018, to the dot-com boom of the early 2000s. He warns that most cryptos may suffer the same fate as the dot-com era.
Also in the news is an alleged cryptocurrency Ponzi-Scheme in South Africa, involving about 28,000 investors. Based on a statement released by the South African police, the Hawks, a unit saddled with the responsibility of investigating priority crimes, the statement shows that over 28000 investors have been scammed of funds exceeding 1 billion Rand ($80.4mln). The case is said to involve BitCaw Trading Company, also known as BTC Global.
Regulatory Adoption: Blockchain Technology still needs to mature, says Deputy Governor of Russian Central Bank
According to Olga Skorobogatova the First Deputy Governor of the Russian Central Bank, blockchain technology has not attained a matured state, robust enough for industrial scale use. Other than its use as a cryptocurrency, i.e. Bitcoin, the tech has not yet been used on a wider industrial scale.
At the St. Petersburg International Economic Forum, she went on to divide blockchain Apps into two major use cases, such as a distributed settlement infrastructure, such as Ripple and Corda; and Smart contract platforms such as Ethereum and Hyperledger.
BTCUSD: 4-HOUR CHART
Using the swing high of $8897.90 and Swing low of $79437.7 to establish the Fibonacci retracement shown in the chart above, we can clearly see that moving forward, the bitcoin price was stopped around the 38.2% retracement and resistance level of $8533.40. Following our projections from last week, the hidden divergence setup also formed at this same Fibonacci retracement level lead to further decline in price and a break of the swing low ($7943.7).
Getting to the close of last week candle/bar, price continued to oscillate above the 161.8% Fibonacci projection. As the new week starts on the 28th, we expect the price to close below the 161.8% fib level and head towards the 200.0% level at $6989.50. This is possible due to the failure of bullish accumulation establishing resistance at $7633.20 and new bearish accumulation resistance formed at $7442.00.
BTCUSD: Weekly Chart
Zooming out to the weekly chart perspective, we can see that the pair has a high chance of trading bearish this week also. The only support level right now is that established by the 65-period moving average as shown in the chart below.
With price recently closing below the 161.8% ($7354.00), we expect a further decline in bitcoin price towards the 200% ($6989.50) level. Bitcoin broker/s alike are believed to use these levels are potential take profit points.
Overall, as bitcoin price moves closer towards the 65-period moving average on the weekly chart ($6500.20), we expect this level to offer a strong support for the pair to spring back into last year’s bullish trend.
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