2018-7-14 22:34 |
On the daily timeframe, Bitcoin is forming its second consecutive tight-ranged candle indicating that there is some indecision in the market. Typically, it takes less volume to move the market on the weekend, but with significant price drops during the week, Bitcoin has been trading flat over the past two days.
Price action and RSI both are forming higher lows as illustrated by the red lines on the daily chart, which would indicate that some selling pressure is coming out of the market.
Bitcoin Daily ChartHowever, it should also be noted that any upward movements were on significantly low volume and the current sideways trading could be some profit taking by short sellers before the next wave. The four-hour timeframe tells a similar story to the daily with price action and RSI showing selling pressure is backing off.
Bitcoin 4hr ChartOne of the top ten traders on the Bitcoin futures trading platform Bitmex during 2017 going by the alias Ugly Old Goat (UOG), noted in a blog post during the week that he feels Bitcoin is unlikely to come back to its all-time lows of 2018 from this point onwards.
The main reason UOG noted this was because of the difference in price between the Bitcoin spot price and Bitcoin futures contracts. Typically, futures trade at par during rallies, but currently, they are trading below the spot price. Futures trading at a premium can be sold by cryptocurrency miners looking to lock in profit ahead of time.
But because futures are trading lower than the spot price, UOG notes that this will bring away the selling pressure which was previously driven by miners out of the market entirely. The only sellers who will remain are speculative sellers that are far more open to changing their outlook based on market conditions.
September Futures (XBTU18) & December Futures (XBTZ18) compared to Bitcoin Spot Key Takeaways: Price action and RSI on the daily and 4hr timeframe are both forming higher lows indicating selling pressure is coming off. Due to low volume accompanying gains, the next significant moves we see in the market could be to the downside as sellers currently may just be taking some profits. With Bitcoin futures price currently trading below the spot price, there is a reason to believe that a lot of the selling pressure has come out of the market which was previously provided by miners looking to lock in profits ahead of time.Weekend Bitcoin Price Action (07/14/18)- Has the Selling Pressure Gone? was originally found on [blokt] - Blockchain, Bitcoin & Cryptocurrency News.
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