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Weekly Chart Flashing Bull Exhaustion Signs
BTC: Price: $8,540 | MCAP: $152 billion | 24-Hr Volume: $20.64 billion
Short-term trend: Correction likely
Bitcoin recovered from the low of $8,000 hit on Thursday to end the week on a flat note. The resulting doji candle on the weekly chart is widely considered a sign of indecision in the market place.
In BTC's case, however, the candle has appeared following a $3,800 price rise and represents bullish exhaustion.
As a result, the case for price pullback below $8,000 signaled by last Thursday's "bearish outside day" candle and the bearish divergence of the daily chart relative strength index looks stronger.
If the price drops below $8,000, then the focus would shift to the 30-day moving average, currently at $7,643, which has a penchant for reversing price pullbacks.
The case for a short-term correction would weaken if a potential bounce from the ascending (bullish) 5-week moving average at $8,220 ends up clearing today's high of $8,476.
Long-term trend: Bullish
BTC closed last month with 62 percent gains - the highest since August 2017 - reinforcing the falling wedge breakout confirmed by April's candle.
Further, the 5- and 10-month moving averages have produced a bullish crossover for the first time since September/October 2015.
Therefore, the path of least resistance is to the higher side. The long-term bullish outlook would be invalidated if and when the price finds acceptance below May's low of $5,263. As of now, that looks unlikely, but the prospects of a slide to $5,263 would rise if the price finds acceptance below the crucial 30-day moving average support in the next couple of weeks.
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SV Takes Another Leg Up BSV: Price: $214 | MCAP: $3.8 billion | 24-Hr Volume: $557.9 million
Short-term trend: Slight bullish
The current daily candle for BSV hints at continuation provided it can close above the daily resistance zone between $195 and $210 and will need to be accompanied by greater growing (bullish) volume by close of session.
Mind overbought conditions as it continues to trend above 70 on the daily RSI with the potential for a bearish divergence to form should it close with a lower high on the indicator and a higher high in its price.
Long-term trend: Bullish
Given recent market developments for SV, it would appear the news regarding Craig Wright's claim of being the real Satoshi, coupled with the bitcoin Whitepaper debacle is propping up prices with the markets refusing to remain below key daily resistances.
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MONA Coin Taking A Breather MONA: Price: $2.82 | MCAP: $192.3 million | 24-Hr Volume: $134.1 million
Short-term trend: Pullback
MONA's incredible 240 percent rise, seen May 31 to June 1 is now hinting at a pullback, courtesy of overbought conditions on the daily RSI and a period of profit taking that's set to ensue before final consolidation toward the 50 percent Fibonacci retracement line at $2.17
Should current prices hold above that line, consider continuation as a strong possibility with the potential for a bounce should it get there, courtesy of strong weekly buying pressure witnessed May 27.
Long-term trend: Bullish
On April 20, MONA experienced a 79 percent rise in value, breaking the bear market trend of lower highs and lower lows and offering up the opportunity for a bullish revival. If prices continue to print new highs that would strengthen the case for continuation over the course of the next two months.
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Bitcoin’s weekly money flow index (MFI) – the volume-weighted relative strength index (RSI) – has risen to 100 for the first time on record.
A reading above 80 represents overbought conditions. The MFI of 100, therefore, is a sign the recent rally is extremely overstretched and a correction is overdue.
So, opening long BTC/USD trades at current levels above $8,000 would be a risky bet, as quipped by @hithrowaway.
Having said that, technical indicators, particularly on the weekly and monthly chart can stay overbought longer than sellers can stay solvent! Hence, the price action always takes precedence over technical indicators.
An overbought reading on the MFI or any other indicator becomes valid only when the price is showing signs of bullish exhaustion, which seems to be the case here.
BTC created a classic doji candle last week, signaling indecision among the bulls (or buyer exhaustion).
So, the extreme overbought reading on the MFI needs to be taken seriously. |
Bitcoin mining difficulty reportedly surged to an all-time high of 7.46T on Friday, surpassing the previous record high of 7.45T hit in October 2018.
The mining difficulty is a measure of how hard it is for miners to solve the cryptographic equations to maintain and add to the blockchain and earn the BTC 12.5 reward.
It is adjusted every 2016 blocks due to variations in hash rate in the bitcoin network. The hash rate increases with the number of miners contributing resulting in an increase in the difficulty.
The new high on the mining difficulty means increased network activity or miner confidence. Hence, many expect the price to follow the spike in mining difficulty.
However, the rise in mining difficulty could be a result of the recent surge in bitcoin’s price. A higher price may have entice more miners to join bitcoin’s network leading to a higher hash rate and a sharp rise in the difficulty. |
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| Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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Buyer Exhaustion