Bitcoin (BTC): Pinned

February 13, 2019 / by Bill Noble

As we discussed yesterday, Bitcoin (BTC) has hurt people who focus on traditional chart patterns. In this case, we are referring to a triangle formation on a Bitcoin (BTC) intraday chart (Figure 1). Bitcoin (BTC) did both a false breakout above the triangle (hurting shorts) and then it did a false breakout below the triangle (hurting longs). This type of action creates a level of trading difficulty that few people can deal with.

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On a daily chart, we noticed that Bitcoin on BitMEX was unable to get above its 50-day moving average (red line, Figure 2).  This development argues for a neutral stance.

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Zooming out from the intraday chop, there are two pieces of decent news. First, the Wyckoff bottoming scenario is still tracking (Figures 2 and 3).

This listless price action may not be the worst thing for Bitcoin (BTC). The choppy price action may be whales selling to asset managers. These big players may be creating a liquidity event referred to in the Wyckoff scenario as the “last point of supply.”

Bottom Line: Bitcoin (BTC) seems to be pinned, waiting for further developments. We continue to believe that the next 10-days are important, and a trading signal from either action or lack of action will soon be revealed.

I will continue to rely on guidance from the Crypto.IQ Trading Group to stay ready for what’s next.

Join me there.