Bitcoin Price Analysis: With August 1st Looming, Uncertainty is the Only Certainty

Bitcoin Price Analysis: With August 1st Looming, Uncertainty is the Only Certainty

With only three days left before Bitcoin’s hardfork is implemented, there is still good uncertainty among BTC-USD markets (which inherently applies to all cryptocurrencies) and what their imminent fate will be. One would expect, with so much market uncertainty, that BTC-USD should be eyeing pulling down prices as people begin to sell their BTC in lieu of other fiat and crypto-assets. However, in a surprising turn of events, BTC-USD has managed to climb by over $300 within the past twenty four hours. Because the speculations regarding the BTC hardfork vary insanely, this market analysis will look at the raw data introduced on the markets and will not attempt to account for any of the hardforking ramifications.

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The figure below shows two indications that the BTC-USD climb is due for a consolidation period and possibly some pullback in price:

Figure 1: BTC-USD, 2HR Candles, Bitfinex, Momentum Loss

The very first that stands out with the current $300 rise is the decreasing volume across the length of this little bull run. Decreasing volume indicates the decrease in market interest in these higher values and typically leads to either a consolidation period or a pullback in price to garner support from lower values.

The 2nd indicator that stands out is the 2HR MACD divergence shown in pink. Typically, for a healthy bull run to sustain its upward momentum, we would like to see the MACD making fresh highs on the histogram to accompany the fresh highs in market value. Looking closely, you can see the most latest high of approximately $2800 did not correspond to a fresh high on the MACD histogram. Thus, another indicator of market momentum loss exposes the enhanced likelihood of market price consolidation.

As always, it is significant to put the current market trend within the context of the grand picture:

Figure Two: BTC-USD, 6HR Candles, Bitfinex, Hidden Bearish Divergence

Looking at the 6HR candles trend, there is a subtle hint of macro bearish divergence on the MACD. When the MACD signal line/moving average makes a fresh high, but the price trend does not make a fresh high, this can be an indication of bearish leaning momentum called “hidden bearish divergence.” In addition to the MACD hidden bearish divergence, we can see a severely decreased volume trend as we treatment the highs made a duo weeks ago. In general, the upper $2000s seem to be a battleground that is beginning fizzle out in a bearish style. This could be attributed to many factors, but ultimately I think the wild price swings can be lightly explained by the good uncertainty in the market surrounding the August 1st hardfork.

With only three days left, speculators are getting situated in their positions. Until the hardfork is implemented, there is no telling what will happen to the BTC-USD markets or the cryptomarket as a entire. So, with all this uncertainty in the air, where can we expect to find levels of support in the event of a major crash on August 1st? The figure below shows the key support levels to look for on the macro scale:

Figure Three: BTC-USD, 12HR Candles, Bitfinex, Key Support Levels

Once again, the key support levels for the macro trend are found along the Fibonacci Retracement values of the entire bull run. Instantaneously below our current values lies very solid, historic support at $2500 values. A test of this support value will ultimately dictate the instant future of the BTC-USD market.

On the run up to $2900 a duo weeks ago, a lot of volume went into the market to develop hard support. A breakdown of this support level could prove to be fairly ruinous to the BTC-USD market in the brief term. The $2500 support level is clearly shown in the massive influx of volume and proves to be a severe point of market interest. To date, that is one of the strongest support levels BTC-USD has established, as indicated by the rise in volume around those prices.

Summary:

On the macro and micro levels, BTC-USD is displaying indications of price consolidation in the near future.

Key support levels are found along the Fibonacci Retracement values. In particular, $2500 has proven its historical significance in the market and should be closely observed in the event of a bear run post-hardfork on August 1st.

Trading and investing in digital assets like bitcoin and ether is very speculative and comes with many risks. This analysis is for informational purposes and should not be considered investment advice. Statements and financial information on Bitcoin Magazine and BTC Media related sites do not necessarily reflect the opinion of BTC Media and should not be construed as an endorsement or recommendation to buy, sell or hold. Past spectacle is not necessarily indicative of future results.

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