Bitcoin Price Analysis Dec. 24

Posted by: pesa_mic

December 24, 2015

Over the past 2 weeks, bitcoin price went up from a low retracement bottom at $ 346, going up to $ 467, attempting to touch last month’s $ 504 high. This rise up has been anything but momentous, especially compared to the run up to $ 502. Low volumes have accompanied this rise up. At current price levels, the trend has hit a resistance level at $467

“resistance at the ¥3,000 ($465) level. If it holds, we could be retracing to 2,000 yuan ($310)”

Here we see the move up from August at $ 198 to $ 502 was huge with no retracements, it was only a matter of time before it retraced. Since the peak, the market retraced the whole move up, then found a bottom at $ 320; this second attempt at maintaining the trend has met resistance. Low volumes highlighted also emphasise this.

This pattern looks eerily similar to January – February 2015.

“Possible fractal in play #BTC”

If this plays out, lower prices are on the horizon.

Looking back at an elliott wave chart I posted in one of my analyses in July, a bearish outlook is not far fetched. This was before events over the past 6 months

Here is an updated chart of the same

It seems we are on the edge of a cliff. Price was expected to find a top in the range between $450 and $ 700, and then head back down to retest lows. It is an option I am open to, and keeping an eye on.

“the time I have drawn in for the C is not a requirement, nor is the depth. It could be something that plays out in just a few months. and even makes a higher low as a failed C. The chart depicts a textbook structure”

Record Highs Predicted after 2016 Supply Halving – Reuters

This week, Reuters ran a piece on possible price projections in 2016 and 2017, some of it expected to be heavily influenced by the much anticipated block reward halving in June 2016; from 25 BTC to 12.5 BTC per block for miners.

“But taken in isolation, the halving of the mining reward will increase the price of bitcoin by around 50 percent from where it is now”

Daniel Masters, co-founder of Jersey-based Global Advisors’ multi-million dollar bitcoin hedge fund spoke to Reuters

“Now he reckons the price of bitcoin could test its 2013 highs of above $1,100 next year and then pick up speed to rise to $4,400 by the end of 2017.”

Certainly a bold prediction, one that chimes with what I periodically reiterate in my analyses. $ 5 billion market is too small for the potential of bitcoin as an alternative asset class in a period of economic fiat crisis.

Tuur Demeester on Bitcoin price prediction

A liberty entrepreneurs podcast featuring Tuur Demeester is well worth a listen. Tuur, an Austrian economist, investor and founder of Adamant research shares his thoughts on BTC price forecast, strategy for investing and opinion on bitcoin development.

16:14 How should you think about investing in the bitcoin space? Tuur has three words for you. “Buy and Hold”.

18:15 “Somewhere in the next two years, there is going to be a panic, and bitcoin is going to benefit from that.”

Trace Mayer – The Rise of the Fourth Great Bitcoin Bubble

Another vocal pundit and investor in this space. In his piece,Trace talks about the forthcoming bubble, reminiscent of previous ones. While he does not pin down a date or number, he recommends a buy and hold strategy too.

“The bear market of the past two years has been brutal, hard, necessary and good. But now it is time to strap in!”

SIDENOTE

If you are keen, themes predicting an upcoming swing in price, are emerging frequently, from pundits in the space. A lot of emphasis on 2017/2018 and the 2 – 3 year timeline. At this point, I recommend strategic buys at favorable prices and plan to hold for the next 3 years. Remember to only risk what you can afford to lose.

In all this, observing bitcoin development is absolutely necessary, particularly scaling bitcoin and security. While there are some promising proposals and expected products that will help achieve this eg Segregated Witness, BIPs, Lightning Network, Sidechains , none is concrete as yet. Scaling bitcoin directly affects its price and adoption – especially in the event of a bubble. I am not expecting another bubble until this matter is resolved.

Bitcoin Weekly Price Forecast

This week, I am bearish and expecting prices to head back down to $ 400, possibly as low as $ 350. This week’s pattern is a triangle – that looks ripe to break. Triangle patterns are fairly common in bitcoin charts, and are always terminal, resulting in a break out – either up or down.

While it could break either up or down, as per this chart, my bias is bearish down.

Updated: 2015-12-24