Bitcoin Daily Forecast - Monday, Jan. 14

BTC/USD

The Bitcoin markets fell apart on Thursday, and on Friday wasn’t exactly confidence inspiring. Looking at this chart, I do think that we have lower prices ahead of us, as the $3500 level will be supportive, but I think it also gets broken. Ultimately, I believe that we are going to test the $3000 level and I think that rallies at this point are an opportunity to start selling. The $4000 level lines up quite nicely with the downtrend line that doesn’t seem to be able to get wiped out, so I think at this point it’s only a matter of time before we continue to see sellers jump into this market place and punish Bitcoin for its lack of functionality.

I do think that eventually the $3000 level will be targeted, but it may take a couple of attempts. If we break down below the $3000 level, then the market could go down to the $2500 level next. Rallies are to be faded, but if we do break above the $4000 level, we may be looking at the 50 day EMA being tested again. If that’s the case, then I think that the $4500 level becomes the next battlefield. I believe that the potential inverted head and shoulders now looks completely blown out, and I think at this point if we continue to go lower, this will be but a distant memory and the talk of a head and shoulders will disappear.

We have been in an extraordinarily bearish time over the last year or so, and I don’t see anything that’s going to change this of significance. Overall, I think that the market is one that continues offer plenty of opportunities to short if you are patient enough, as seen during the Thursday candlestick.

(Click on image to enlarge)

Bitcoin

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