Yesterday evening we published a piece outlining the day’s action in the bitcoin price on Thursday, and suggesting our “key levels to keep an eye on” as we headed into Thursday evening and beyond. Action has matured overnight, and the bitcoin price still looks to be suffering from the effects, or fall out, of the fundamental downside pressure we saw as a result of a closing exchange and a runaway marketplace on Wednesday. With this said, what are the levels to keep an eye on as we head into the weekend, and what can these levels tells about the likely future of the bitcoin price near-term? Take a quick look at the chart.
As you can see, we’ve been trading within the confines of a gradually upward sloping channel having hit a floor of 249.47 late Wednesday night. We are now at the lower end of this channel, trading just ahead of in term support around 258 flat. If we see a bounce from this level over the coming half hour or so, look to 268 as a medium-term upside target. From there, this will be the level to watch. It is likely we will see another bounce down, and a correction back towards 260 flat. If we break below this level, we could easily see 250 flat before the day draws to a close. On a break of 258, a stop loss just above (somewhere around 258.50) and a downside target of 249 would offers a nice risk profile.
Conversely, if on testing channel resistance around 268.00 we can get a break out of the channel, look for a retest of broken resistance as support to validate a medium-term upside bias towards an initial target of 274.84. A stop loss just short of 268 will ensure a timely exit in the event of a bias reversal in such a trade.
Charts courtesy of Trading View