11/11/2018/09:00CET
Bitcoin finding a bid as it finds support in the wedge structure.
BTC trades at 6358 USD going into its second day after a short sharp correction.
Very nice to see that it bounced off our wedge which was acting as resistance and now is support.
Never nice to see the moving average point downward, but they are all close by, the 100 standing at only 6511.
It is well within BTC's capability to jump over these very quickly.
There are numerous ways to place wedge boundaries but I think most TA people have constructed a similar wedge to the one you see here in green. This wedge ends shortly and we hope to see the ascending boundary continue to act as a support. This would establish it as a springboard for the next upward price moves.
On the downside, we still have a dearth of volume. Here we look at the coinbase chart but it is similar to this all across the open trading platforms. All we can cling to is the less direct indicators of growing volumes in the OTC market. OTC markets can make the open markets look like the top end of icebergs. But by their very nature they live in the shadows so we can only extrapolate meaning from the scant news we get. Remember, they do not want us to know what is happening on them, hence the whole idea of OTC.
The lack of volume leave us susceptible to manipulative market action. Sadly it is enormously profitable to push the price of BTC around in order to magnify profits on exchanges like Bitmex that allow ludicrous margin trading ratios.
A 50usd pump or dump can net them a spread of 500 or even 5000usd on margin. And with low volumes it take ever smaller orders to move markets.
At the moment daily volumes on Coinbase run around 5000btc, though it has been down at the 2.5-3k in the last weeks. There are holders out there that can dump that amount onto the market in a few well timed orders. Guess how price reacts? They profit 2 times. They place bets on Bitmex to the downside. And they can buy back their dump coins at a lower price now that they got the dumb money to dump as well.
I remain bullish on BTC and the overall cryptocomplex, though I see that in this weak state, nasty surprises can happen. Retesting 6k for the n'th time is really not so difficult to imagine.
As always guys, leave comments, have fun and trade safe.