Hi traders, a larger Bitcoin bounce could be in the work.
As I discussed in my last article, failure to break below $5700 could play in favor of the bulls and produce a bounce.
After 6 weeks of almost uninterrupted selling, price has now started to form a rounded bottom on the weekly:
... what's more the weekly Stoch RSI is completely oversold and has started to cross over, which historically has been quite a reliable indicator of a bounce:
... which is lucky considering that the absence of volume below $5700 suggests that a clean, high momentum break below this level would have most certainly sent the price tumble back down to $4400 on a capitulation candle:
If $6000 were to be where the market has found fair value, then what happens next will depend on regulations.
This July the Financial Action Task Force (FATF)...
...which is the financial arm of the G20, will submit their recommendations regarding the regulation of crypto currencies.
My take is that we might not see a lot of action in the market until the G20 comes up with some recommendations regarding global regulation of cryptocurrencies. Mind you this G20 story could also turn out to be a complete non-event in which case it would be interesting to see how the market would react.
Until then I recommend you keep a close eye on the $5700 level for the sake of risk management and frequently check the FAFT website for updates. Don't trade the chops and keep dry powder for some high probability trades like a high volume dump or a clear prolonged accumulation.
What do you think of the market traders? Is $6000 fair price for Bitcoin?
