After some pretty hefty gains and downright fantastic upwards movement this year, Bitcoin is starting to act a bit strange.
I have attached several charts showing different viewpoints, depending on the type of individual use of Bitcoin. The first is a longer term picture showing the big run and its pennant formation of its consolidation, using a daily chart. The second is the 6 hour swing chart, which tracks the short term to intermediate term movements and its support and resistance, navigating its sideways consolidation. Lastly, is the intra-day trading lines developed by me and are unique and accurate for anyone wishing to trade Bitcoin on a daily basis, using a 4 hour chart.
This has been the longest sideways movement for Bitcoin this year, to me this is a very positive indication on many levels. For starters, even if she breaks the pennant to the downside, we must watch to see if she maintains the overall sideways movement. It can morph from a pennant to a flag formation, which is still a bullish sign.
It is this stability that we are looking for in a currency alternative. If Bitcoin can manage longer bouts of stability in between its price appreciation adjustments, as more people begin to utilize it worldwide, then we have a real chance of a solid base to move over to, without the fear of volatility.
This long term chart is showing the breakdown of its pennant formation, if it closes below it will signal a possible further downside correction or a morph into a flag.
In the second chart, we can see the various short term movement trend lines and for the most part its behaving quite orderly, respecting its own trend lines. I will continue to watch these trends and provide updated charts.
Lastly, here is my personally developed support and resistance lines with the Zero point. As you can see, it current price is below the Zero point, this is indicating a negative or downward sentiment. It must regain this level in order to keep its daily upward strength. The lines below are its other support levels and the one above is its next resistance level.
There are so many different crypto currencies available and each have their own attractiveness and faults. However, if we can start to experience multiple currencies exhibiting longer sideways consolidation periods, many more people will find it more attractive to begin using it as money.
Of course until then, we will experience some growing pangs, but that will also provide opportunity for large profits. Many will argue that we have not experienced a deep enough correction in Bitcoin, this may be true and we may find out soon enough.
In any event, if you are waiting for an entry point, I would wait for a clear upward breakout of the pennant or a possible flag. In contrast, if we do indeed fall further, then we must re-evaluate at a new support level and analyze the opportunities at that point.
Until then, good luck and enjoy the ride!