Bitcoin Re-Enters Consolidation Chop Zone After Rejection - Price Analysis

  • Short term: likely down to low $9k, but choppy in general
  • Long term: grand uptrend remains intact until large breakdown of $9k support

After approaching a downtrend resistance line before the weekend, Bitcoin (BTC) has so far been duly rejected at that downtrend and sent back down into its familiar consolidation pattern. A short term downtrend seems to obtain, which may see the leading crypto again retest the bottom of the (shrinking) range within the coming days.

We start with a 3-hour chart for a close view of the action. We see that price was rejected precisely as it reached the downtrend resistance (red band) - and rejected very hard and abruptly, causing a sharp reversal in the 21 exponential moving average (EMA).

Likely leg down to high $9sBTC chart by TradingView

The rejection occurred right after a tiny, false breakout from an equally tiny rising triangle, whose weakness was clearly broadcasted on the indicators ahead of time. Although volume is low across the board, buy volume on any counter-rally attempts has been very low suggesting a short, intra-pattern downtrend down to support.

Moving to the daily, we note first that three important EMAs - the 9, 21, and 55 - are all clutched together, and that day’s daily candle is already trending below it. It seems likely that closing below this EMAa knot will ensure that Bitcoin completes the cycle all the way back down to the often-retested support starting at about $9,500.

Watch for daily close below the EMAsBTC chart by TradingView

As the reader can see, price is shrinking down into the apex at the end of a long consolidation pattern (late June), probably a descending triangle which is generally considered bearish. If there is not a dramatic price reversal soon back up to the top of the pattern, Bitcoin will soon face a renewed possibility of breaking down out of the consolidation zone.

However, despite the bearish expectation of a descending triangle, chart patterns are often - quite simply - wrong or more complicated than a simple “if, then” formula. If we look on the weekly chart, we see that Bitcoin just as easily looks like a giant bull flag or pennant, and the consolidation is just an accumulation zone before price breaks higher - as we would expect from a bull flag.

Honestly looks like a bull pennantBTC chart by TradingView

Volume continues to fall overall, and the pattern - at least by its visual profile - looks like it could continue to shake out through the rest of September. On the weekly candle close, we see that price closed will above the previous week’s red body and on equal volume. But there isn’t much to see here, and a slow chop and squeezing-out of volatility looks pretty boring from this distance.

The next milestone is likely to be a retest of the bottom of this pattern, at about $9,000 or just above. Until then, and unless a dramatic break up arrives out of nowhere, we have a chop zone. Only a break of $9k would have us revisit the long term bullish assessment.

The views and opinions expressed here do not reflect those of and do not constitute financial advice. Always do your own research.

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Crypto Scammers Responsible for $24 Million in Bitcoin Theft Through First Half of 2020: Report

Michael LaVere
  • New Whale Alert report shows crypto scammers have raked in $24 million in bitcoin through the first six months of 2020.
  • One scammer leveraged YouTube advertising to steal $130k in BTC per day. 

Crypto monitoring service Whale Alert has published a report showing that crypto scammers are responsible for $24 million in bitcoin theft through the first half of the year, including the exploitation of YouTube advertising. 

According to the report “Chasing Crypto Criminals” published July 10, cyber-thieves are finding easy prey in the form of bitcoin and other crypto-asset investors. Whale Alert summarized its exhaustive reviews of hundreds of websites and thousands of reports of theft as “crypto crime pays. A lot.” 

Whale Alert claimed there was little risk involved for crypto-based criminals, despite the massive economic impact being imposed on victims. The report confirmed at least $38 million in bitcoin alone being stolen via scams over the past four years, excluding the use of Ponzi schemes. 

The report reads, 

Some of the most successful scams made over $130,000 in a single day with nothing more than a one page website, a bitcoin address and a decent amount of YouTube advertising.

Whale Alert outlined another scam which brought in $1.5 million over six months through promoting a fake cryptocurrency exchange. The report claims the advertisement took victims to an “amateurish website riddled with spelling errors,” before tricking users into depositing their funds. 

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