In my previous post, I pointed out this "wedge" and a support line in the STEEM-BTC price around 40K satoshis. I also stated that this line of support would be tested very soon...and it was. The price actually dipped just below that support line shortly after I posted. It didn't stay there for long, quickly recovering back to 43K satoshis. Since May 11th, the price has not broken that support.
However, the price has not climbed high enough on the charts to break the current downtrend and the wedge continues to put pressure on a break, likely downward.
We can see in the first chart here that there was an immediate break of the 40K support line after the local highs on May 8th. We see a second break that barely brought the price into the 39s, but mostly a STEEM-BTC price that has remained above support. And there is also a very clear descending triangle that is on the verge of breaking.
The current support line is resting on that 38.2% Fibonacci retracement line as well. If the price breaks down, I'm still looking at some light support around 37K satoshis (blue), but stronger support and likely the near-term floor at 31K (red), which is also "confirmed" by the 23.6% Fibonacci line.
Also notice the continued decrease in volume, which typically does not bode well for prices.
Looking at the Poloniex depth chart isn't too encouraging, but there may be a little room to run upwards. However, it's a short window.
The STEEM-USD price has bounced between $0.70 and $0.80 for the last few days. There aren't many STEEM-USD markets, so this price mostly just reflects the value of STEEM, relative to where Bitcoin is trading in U.S. Dollars. It will pretty much follow wherever the STEEM-BTC price is going.
To me, the indicators appear to be pointing to another leg down, even if it's brief or shallow on the charts. I think we might see it at least test the light support at 37K, possibly in the next 24 hours of posting this.
If the price can clear 43K satoshis, then that would be a good indication that the STEEM-BTC price is building strength at current prices and may end up range-bound for the near-term. Piercing this price soon would be a clear break of the wedge.
If the price can clear 47-48K satoshis, I'd feel much better about range trading. Making its way to 52K and above would be a good indication that the price does not intend to trade back down toward the current support line in the near-term.
If you're trading, always remember:
Never invest or trade what you cannot afford to lose and put tight stop-losses in when prices creep lower towards the support lines.
As always, if you have any critiques or comments about my non-professional analysis, please let me know. If you decide to trade this market, good luck to you!
*Charts are from Poloniex and Coinmarketcap.com. Analysis is current as of approximately 12:30am EST, May 15, 2017.
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