Analysis provided by Ashton Fraser, learn more about his trading strategies at Forex Reversal.
Bitcoin has fallen this morning, but some technical support provides a little hope for the bulls.
Lets take a look at the BTC/USD hourly chart below (click to expand).
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We saw how price reached a high of 630 over the weekend. That was exactly 24 hours ago. Since then, price has done nothing but drop until this morning, where it reached a low of 558.
I’ve done the Fibonacci study from the low of the 21st to yesterday’s high, the most obvious place to do the study, especially on the hourly chart. What’s even more obvious is what level price stopped at this morning. The 61.8% Fib retracement level, circled in green. Surprise, surprise. Well, not exactly.
Besides being an important Fib level, there are other technicals coming into play as well. Firstly, take a look at the Stochastics (10,6,6). Check out how underbought/oversold they are, plus they’ve now actually crossed over and heading upwards. Secondly, the Accelerator Oscillator has also turned green.
Whilst these are not enough of a reason for price to now start shooting north, at the very least we’re going to have some fluctuation, probably for a few hours yet, between the 61.8% and 38.2% Fib levels.