BTC Analysis: 11/03/2018 – morning

The following example of technical analysis, represented in image1 , is dedicated tobitcoin (BTC) , in the morning of today, on timeframe 4h . The goal is to understand what are the current trends in progress.

NB: timeframe means that prices are grouped in periods of 4h, or each candle (image on the chart) refers to 4h (less than the last one in progress). For the most inexperienced we will soon insert an article that better explains how a graph is drawn and how trends are traced, supports and resistance;

Immagine1: graph BTC TradingView (BITSTAMP) - Timeframe 4h - 12.40 of 2018/03/11Immagine1: graph BTC TradingView (BITSTAMP) – Timeframe 4h – 12.40 of 11/03/2018

The main information on the chart is:

  1. Dotted red line: main trend, bearish now from mid-December 2017 (traced by passing a line for relative maximums);
  2. Green line: support dictated by a large minimum formed at the beginning of February 2018 (for the most inexperienced, simpler, a support is a line that supports the price, ie under which it is hoped that the price does not fall);
  3. Horizontal red line : resistance dictated by the last minimum point (for the most inexperienced, as opposed to the support, resistance is a line that is resistant to the price increase);
  4. Oblique red line: it was the previous uptrend that, since it was knocked down, turned into resistance;

The interpretation of these lines, as well as the tracing, is all given by the analyst’s experience. Moreover it is not an exact science because it studies past prices and can not predict future prices but only give suggestions.

A datum that emerges from the analysis is the following:

  • The resistance of point 3 (the previous minimum) has been tested but not exceeded. Moreover the volumes (indicated by the bar chart) are low;

At this point the analysis made suggests the following possible trends:

  • Bullish: In the coming hours there could be a further test of the resistance at the point 3, which if exceeded could be a sign of rising price with the objective possible resistance described in point 1 (the main trend);
  • Bearish: The support of point 2 (the minimum of February 2018), on the other hand, is a possible objective for the next few days if the price continues to fall;

In our opinion, the most likely trend in the short term is the bearish one, but the price must be monitored in the next few hours .

The strategy we are currently using is to accumulate BTC at the rate of € 7200 or less, in order to obtain a profit (Take Profit) if it goes back to around € 9000-9400. However, people who do this by trade, take advantage of the high price volatility (ie the fact that there are large climbs and descents) to get gain even in the descent phase.